Fiat Shareholders Clear Way for Chrysler Merger

Fiat SpA shareholders voted at Wednesday's annual meeting to convert the company's savings and preferred shares into common stock, thus setting the stage for an eventual merger with Chrysler Group LLC.

Fiat-Chrysler CEO Sergio Marchionne tells reporters that the Italian company is interested in obtaining 100% of Chrysler but says that is "highly unlikely" to happen this year. Fiat, which owns 58.5% of Chrysler, would need to negotiate the purchase of the remaining shares with the union-run retiree healthcare trust that owns them.

Fiat has the right to buy the 41.5% stake for $4.3 billion. But Marchionne contends that the market price of that stock is much lower. He reiterates that Fiat could boost its Chrysler stake to 61.8% by year-end by exercising options to acquire a 3.3% stake from the trust.

Marchionne says the process of integrating the two companies will be halfway complete by year-end. He says the companies achieved savings of €1 billion last year from synergies in addition to €400 million saved in 2010.