Fiat to book €450 mln gain from Credit Agricole Venture
Fiat SpA, Italy's largest manufacturer, will book a gain of €450 million ($595.2 million) from the sale of a stake in a car-financing unit to Credit Agricole SA.
The creation of the joint venture will give Fiat a cash injection of about €3 billion, including the repayment of inter-company debt, and reduce its net debt by about €350 million, the carmaker said in an Italian stock exchange statement. Credit Agricole is paying 1 billion euros to acquire half of car-financing company Fidis Retail Italia SpA, which will be renamed Fiat Auto Financial Services, a 50-50 venture that will be run jointly by Turin, Italy-based Fiat and the French bank.
The venture, announced in July, will be „an essential contribution to the achievement of our ambitious sales objectives in Western Europe,” Fiat CEO Sergio Marchionne said in the statement. For Paris-based Credit Agricole, the venture will strengthen the company's foothold in Italy, where it's also buying 663 bank branches from Milan-based Banca Intesa SpA in a deal valued at about €6 billion. The European Commission, the 25-nation European Union's antitrust regulator in Brussels, approved the venture between Fiat and Credit Agricole on December 5. (Bloomberg)
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