Fiat completes Chrysler buyout

Fiat has completed its buyout of Chrysler. The Italian manufacturer has taken control of the remaining 41.5 per cent of the US car marker it did not already own in a deal worth around £2.6 billion.

The agreement was struck earier this month, when Fiat was finally able to come to a deal to buy out the Veba union's pension trust. As part of the deal, Chrysler will give the trust a total of £425 million over the next four years.

The deal is seen as a significant breakthrough for Sergio Marchionne, chief executive of Fiat and Chrysler, as it allows him to avoid a clause that would have required him to offer Chrysler shares in a public offering if an agreement hadn't been struck.

As a result, Fiat is expected to be able to draw on Chrysler's technology more swiftly, and gain more from Chrysler's current profitability, which is in stark contrast to Fiat's struggles in Europe. In particular, the revival of Alfa Romeo is said to hinge on using Chrysler know-how.

"The unified ownership structure will now allow us to fully execute our vision of creating a global automaker that is truly unique in terms of mix of experience, perspective and know-how,” said Marchionne.

Chrysler officials have said the company still has "volume aspirations" in the UK following the deal, despite news that Fiat-owned Lancia will now move to selling cars solely within its home market of Italy. Models such as the Ypsilon supermini will continue to be sold in this country.

Veba had previously threatened to sell its shares on the open market rather than to Fiat, after the two sides valued its shareholding wildly differently. Fiat had offered £1.2bn, whereas Veba was demanding £3bn.

The future of the newly combined company, including where it will base its headquarters, will be decided at a board meeting at the end of this month. Marchionne is expected to reveal a new three-year plan for the business in May.