Chrysler Notes Conflict of Interest on IPO

Chrysler Group LLC has updated its initial public offering registration statement that notes CEO Sergio Marchionne and other executives may have conflicts of interest about the IPO, Bloomberg News reports.

The conflict arises from Marchionne's dual role as CEO of Fiat SpA, which owns 58.5% of Chrysler and wants to buy the remaining 41.5% stake held by a union healthcare trust.

A direct purchase has been stalled by an inability by Fiat and the trust to agree on a price. The trust has forced Chrysler to file for an IPO that would establish a share price but also thwart Fiat's hope of buying the American company outright.

Bloomberg points out that, as the head of Chrysler, Marchionne is obliged to support the IPO. But as the head of Fiat, he opposes it. Analysts have predicted the two sides will resolve the price debate before the IPO is launched next year.