The U.S. carmaker Chrysler filed for an initial public offering on Monday, September 23, Agence France-Presse says.
As it stands, JP Morgan Securities was chosen as an underwriter. The number of shares included in the IPO and the price range for them had yet to be determined, Chrysler added. The timing of the IPO is not disclosed either, however it is expected that initial public offering will be conducted in the first quarter of 2014.
The company had to go public after Fiat which owns a 58.5% stake in Chrysler has been unable to agree on the value of the shares that holds UAW Retiree Medical Benefits Trust known as Veba Trust.
Negotiations between the retirement trust and Fiat, seeking full ownership of Chrysler, began yet in 2011. However, the parties could not agree on the market price. Fiat estimated Chrysler at $4.2 billion, whereas the pension fund fetched $10.3 billion.
In January 2013, the trust fund said it was going to exercise a right of filing for IPO. This right was enshrined in the agreement which dates back to 2009. Complied with the document, Fiat and UAW Trust purchased Chrysler’s shares to save it from going bankrupt.
At that, according to the analysts, Chrysler’s registration for the IPO may not necessarily result in an actual stock offering. The deal may be closed before the official offering if the two sides agree on the price before the shares are sold.