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Fiat's Marchionne to stay on for at least 3 years
January 13, 2014 / 3:00 PM / in 4 years

Fiat's Marchionne to stay on for at least 3 years

DETROIT/MILAN (Reuters) - Sergio Marchionne will remain the chief executive of Fiat FIA.MI for another three years at least, Chairman John Elkann said on Monday, ending speculation that the architect of landmark deal with Chrysler may soon retire.

Fiat CEO Sergio Marchionne poses after the presentation of the new LaFerrari hybrid car on the Ferrari stand during the first media day of the 83rd Geneva Car Show at the Palexpo Arena in Geneva March 5, 2013. REUTERS/Denis Balibouse

Marchionne, who took the helm of Fiat a decade ago and in 2009 also started running Chrysler, had previously he could step down in 2015.

But the group’s chairman, John Elkann, said Marchionne would stay on to oversee the execution of a new 3-year industrial plan Fiat will unveil by May following a long-pursued deal that handed the Turin-based group full control over its U.S. unit Chrysler.

“Not before three years,” the scion of the Agnelli family controlling Fiat told a press conference at the Detroit auto show when asked about Marchionne’s possible departure, adding that he would remain as chairman of the merged group.

“There will be a succession, but definitely not before the conclusion of the industrial plan,” said Elkann, who was sitting next to Marchionne. A successor to Marchionne would probably come from within the group.

In the plan, Fiat is expected to outline its strategy and investments, including new models, the group will pursue as it seeks to turn around its loss-making European operations. Marchionne said he did not expect the European market to revoer this year.

He had earlier said organizational details and where to locate the legal headquarters of the combined Fiat-Chrysler group would be discussed at a Fiat board meeting on January 29. The formal merger of the two companies is expected to be completed by January 20.

A listing of the combined group was “technically possible” this year, Marchionne said, declining to confirm if this was indeed his plan.

He did not say where the group’s primary listing would be. In an interview with an Italian daily last week, Marchionne said New York was the most liquid market, but Hong Kong was also a possibility.

The 61-year old Marchionne said a mandatory convertible bond was one of the options the company was considering to boost its capital base after the $4.35 billion Chrysler buyout deal was announced on January 1, while he again ruled out a share issue by either Fiat or Chrysler.

Media have speculated the size of the bond could be around 1.5 billion euros ($2 billion).

Fiat shares were up 0.67 percent at 6.76 euros by 1416 GMT, roughly in line with Milan's blue-chip index .FTMIB.

writing by Agnieszka Flak in Milan; Editing by Louise Heavens

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