Fiat Chrysler Automobiles has had no change of plans with regard to its Magneti Marelli parts business, according to Bloomberg, even with a new Chief Executive Officer now at the helm. The late Sergio Marchionne had indicated that the unit would be spun off into a separate business entity, much as FCA did with its Ferrari and CNH Industrial businesses, but Marchionne was replaced in late-July by former Jeep/Ram brand head Mike Manley after taking ill and later passing away.
Despite this, FCA told Bloomberg by email, the automaker still plans to spin off Magneti Marelli and distribute shares in the new company to FCA shareholders, although the automaker hasn’t quite closed the door to takeover offers. The automotive parts producer could be valued as high as €6 billion ($6.9 million US) in a sale, Bloomberg‘s sources have said, and reportedly, both Apollo Global Management and Bain Capital are interested.
“As previously announced, Fiat Chrysler is pursuing a plan to separate the Magneti Marelli business,” an FCA spokesperson told Bloomberg Thursday. “In the meantime, as the company has previously indicated, it will evaluate bona fide proposals for alternative transactions.”
A number of suitors have already shown an interest in acquiring all or parts of Magneti Marelli in the recent past, including Bain Capital, Samsung, Brembo, and Tenneco. Late FCA CEO Sergio Marchionne said in June that the automaker was still open to selling the business if anyone came along with a big enough check; otherwise, he reiterated, Magneti will be spun off into a separate company, and shares distributed to FCA shareholders, by the end of the year.
Divesting itself of Magneti Marelli would provide Fiat Chrysler Automobiles a quick way to create extra value for shareholders, and simplify the complex, multinational company, which could be especially useful should Marchionne’s successor decide to pursue merger talks with another automaker.