Share market watchdog probes Fiat's cash pile-paper

MILAN Mon Oct 8, 2012 4:13am EDT

MILAN Oct 8 (Reuters) - Italian stock market regulator Consob is trying to determine the "size and purpose" of Italian carmaker Fiat's cash pile, which the carmaker puts at 22.7 billion euros, Rome daily newspaper Il Messaggero said on Monday.

Both Consob and Fiat declined to comment.

The paper said that Consob's inspectors were looking at the company's balance sheets, without providing further details.

Relations between Fiat and the regulator are tense, the paper said, pointing to a speech Fiat's chief executive Sergio Marchionne gave on September 24 in which he said Fiat had been "exasperated" by the regulator's "19 letters" between April 2010 and October 2011 asking for more information about its plans to invest in Italy.

Fiat has 12.1 billion euros in cash and equivalents, and Chrysler, in which Fiat has a 58 percent stake, has 10.6 billion euros, it said on July 30. Fiat cannot access Chrysler's cash because of agreements with Chrysler's creditors.

Fiat has come under fire in Italy for delaying investments in new cars until the market recovers from a five-year slump. Fiat has said it needs to keep a lot of cash on its balance sheet in the event of a credit crunch.

It also plans to use the cash in part to buy up the remaining stake in Chrysler which it does not already own.

(Reporting by Jennifer Clark; Editing by Greg Mahlich)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.