Fiat and Chrysler could merge by year-end - Marchionne

GENEVA, March 6 Wed Mar 6, 2013 8:37am EST

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GENEVA, March 6 (Reuters) - Carmaker Fiat's Chief Executive Sergio Marchionne said on Wednesday that if he agrees to buy the stake in its U.S. unit Chrysler that Fiat does not already own, then the two could merge by the end of this year.

Fiat owns 58.5 percent of Chrysler, and wants to buy the remaining stake from a healthcare trust called VEBA affiliated with the United Autoworkers' Union.

Fiat and VEBA disagree on the value of VEBA's 41.5 percent stake. The pair are expected to begin negotiations some time this year.

Should the two parties reach an agreement on price, then "a merger between the two companies is technically possible by the end of the year," Marchionne told journalists at the Geneva Car Show.

Fiat took a stake in Chrysler in 2009 when the U.S. group emerged from a taxpayer-backed bailout, and Marchionne already manages Fiat and Chrysler as one group. He has said he believes that having full control of Chrysler will give the group greater operational flexibility.

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