Fiat Chrysler Automobiles continues to weigh the option of spinning off its premium Alfa Romeo and Maserati brands, according to Bloomberg, along with some of its components business. It’s thought that the split could set FCA up better for a future merger with another automaker by shifting its focus more totally on high-volume, mainstream products, according to a few unidentified insiders.
Analysts estimate that together, Alfa Romeo and Maserati could be worth as much as €7 billion (approx. $8.3 billion US), and Magnetti Marelli and other parts operations could be valued as high as €5 billion ($5.9 billion US). A final decision on whether or not to split off these parts of Fiat Chrysler will be made by early-2018.
Spinning off parts of the business is no foreign concept to FCA CEO Sergio Marchionne; Ferrari began trading independently from the rest of the automaker in 2016, and the company has done well since, with share value nearly tripling since the supercar maker’s IPO.
There are risks with spinning off the Alfa and Maserati brands, however.
Neither Maserati nor Alfa Romeo has the same pull as Ferrari, Bloomberg points out, which could spell difficulty if the brands are left without the support of a larger, wealthy automaker. On top of that, Alfa is still striving to become a significant player in the premium segment worldwide, which will require billions in investments. Fiat Chrysler is considering finding the two brands an appropriate partner in order to combat those factors, insiders say.