MILAN Jan 7 Moody's said on Tuesday it had
placed Fiat's ratings under review for downgrade
because the car maker's cash position would be significantly
weakened as a result of its plans to buy the stake of Chrysler
it does not already own.
In a statement, the rating agency said it had placed Fiat's
Ba3 corporate family rating on review for downgrade.
"The announced acquisition will materially weaken Fiat's
liquidity position at a time when the company is still free cash
flow negative," said Falk Frey, Moody's senior vice president
and lead analyst for Fiat.
On Jan. 1 Fiat struck a $4.35 billion deal to gain full
control of Chrysler Group LLC.
Moody's cited rising challenges in Latin America as one of
the reasons for its move.