Fiat-Chrysler Automobiles previously announced plans to spin-off its Magneti Marelli parts business, but the automaker may have a new deal on the table.
According to the Wall Street Journal, FCA is reportedly in talks with New York-based KKR to sell the parts business. Magneti Marelli supplies electronics, automotive lighting and powertrains. The entity could be worth as much as $5.8 billion.
Selling the business rather than spinning it off from FCA could provide a major cash infusion for future product plans, and KKR would expand its hold on the auto parts sector. KKR would potentially purchase Magneti Marelli through Calsonic, which it acquired from Nissan last year for $4.5 billion.
An FCA statement neither confirmed or denied the current talks, but the automaker said it continues to move forward with plans to spin-off the business. In the meantime, FCA “will evaluate bona fide proposals for alternative transactions that may be in the best interest of the company.”
FCA’s new CEO, Mike Manley, said he intends to carry out a Magneti Marelli spin-off unless a buyer does show interest.