There Is Speculation That Alfa Romeo And Maserati Might Be For Sale
Sergio Marchionne, CEO of Fiat Chrysler Automobiles is insistent that Alfa Romeo is not up for sale. Industry analysts, on the other hand, see the selling of Alfa Romeo as well as Italian make Maserati as a distinct possibility.
Fiat Chrysler Automobiles (FCA) has seen their share price steadily decline over the course of 2016 partly due to the $7 billion debt hanging over the company’s head and causing major concern for investors. Reports came out on Tuesday from Forbes that certain high ranking investors do see a glimmer of hope for the beleaguered company and that the investment outlook is improving.
One of the sources Forbes was referring to was Berenberg Bank. They foresee potential spin-off from Alfa Romeo, Maserati and Magneti Marelli, which us a supplier. Alexander Haissl, a Berenberg analyst said. “Further asset divestments/spin-offs—Magneti Marelli, Maserati—have the potential to make FCA debt-free, which would re-rate the equity meaningfully…”
CEO Marchionne is set to retire in 2018 and has said in the past that he wishes to leave the company with low debt and trading profitably. Given that of the Giulia and Stelvio models have just been released, a sale of Alfa Romeo does not look that likely. It is expected that FCA will use the Giorgio platform to release upgraded versions on the Dodge branded Challenger and Charger models.
The future of Maserati however is not so certain. The company is already limited by the obvious low-volume nature of the luxury brand, They have also been delaying the release of a remodeled GranTurismo for some time now. They also failed to release sports car in line with the Alfieri concept from 2014. According to Haissl, the Maserati could rake in between $3.6-$4.8 billion.
That is sufficient to wipe out the bulk of FCA’s debt. He goes on to say that Magneti Marelli could fetch an additional $2.3-$3.7 billion. Recent reports stated that Magneti Marelli was nearly sold to Samsung. If rumors are true, this would not be the first time FCA have some something similar. Just last year they did the same with Ferrari and listed it on the New York Stock Exchange. In doing so they sold 10 percent of their 90 percent share in the brand.