The component operations and parts business that is Magneti Marelli is on the table along with a potential Alfa Romeo and Maserati spin-off to slim down what FCA is composed of. In turn, it could make the automaker more attractive for a buyout or merger. The report also says Magneti Marelli was nearly sold off in 2016, but negotiations with buyers fell through.
FCA CEO Sergio Marchionne has been keen to reduce the automaker’s debt with a goal to be debt positive by the end of 2018. Currently, FCA holds a net industrial debt of $5 billion. If the automaker is able to unlock greater value by spinning off its Italian luxury divisions and Magneti Marelli, it could significantly reduce its debt figure. Magneti Marelli is reportedly worth nearly $6 billion.
However, any future plans likely won’t involve the sale of Jeep. Although Chinese automaker Great Wall has come forward as an interested party, Marchionne believes FCA would not be poised for success without the SUV division. FCA also rebuked all reports stating Great Wall had approached the U.S. automaker with intent to buy Jeep.