AMSTERDAM (Reuters) - Fiat Chrysler Automobiles (FCA) (FCHA.MI) does not plan a hostile bid for rival General Motors (GM.N) at the moment and will focus on executing its growth plan until the right partner is found, CEO Sergio Marchionne said.
Marchionne, who has called for consolidation in the industry to share the costs of developing more technologically advanced and cleaner cars, said finding a partner was “not a matter of life or death” for FCA.
“We are not choking. We are in relatively decent shape,” Marchionne told journalists in Amsterdam on Thursday following a shareholder meeting that approved the demerger of sports car business Ferrari (RACE.N) from the group.
This year Marchionne sent an email to Mary Barra, his counterpart at GM, proposing a tie-up but was turned down.
“This is not an indiscriminate dating game. I‘m not willing to go with anybody to get it done,” he said.
“We have been publicly rebuffed, we have been rejected and you cannot force these things. I don’t want to,” he said. “At the moment, we have no intention to do anything hostile.”
He added that other, less obvious merger candidates existed that could offer similar benefits for the world’s seventh largest carmaker by sales.
Marchionne said FCA would first focus on a 48 billion euro ($52 billion), five-year investment plan centered on turning Alfa Romeo, Jeep and Maserati into global brands. Once implemented, the dynamics of the discussion with a potential partner “will completely change,” he added.
Analysts have raised concerns about FCA’s ability to execute the plan, given its net debt of 7.85 billion euros, product delays and persistent weakness in Latin America, only partially offset by a recovering car market in Europe and firmer margins in FCA’s North American business.
While confirming overall targets until 2018, Marchionne said FCA would present an updated product plan in January to reflect changes in the market, including slowing growth in China.
“The model plans will not change, but we need to adjust the timing,” Marchionne said, adding that not doing so would have been “suicide”.
These may include some Alfa Romeo and Maserati product launches being delayed and the sales target for its popular Jeep sport utility vehicles being raised. Marchionne added that capital expenditure for 2016, which was supposed to be the peak spending year of the plan, would likely be reduced.
On Thursday, shareholders approved the separation of Ferrari, paving the way for Italy’s Agnelli family to become the luxury sportscar maker’s biggest shareholder. The vote was held in the Netherlands where the FCA group is registered.
FCA sold 10 percent of Ferrari in an initial public offering in October and will distribute its remaining 80 percent in the maker of supercars such as the 1 million-euro LaFerrari to FCA shareholders to complete the spin-off.
The overall windfall for FCA from the listing and spin-off is seen at over $4 billion.
The distribution of Ferrari shares to FCA investors will happen on Jan. 4 and a secondary listing of Ferrari on the Milan stock exchange is expected to launch the same day.
Marchionne added that a separation of other brands from the group was “highly improbable” in the near term.
FCA shares in Milan were down 2.2 percent by 1540 GMT.
($1 = 0.9221 euros)
Editing by Jason Neely and Keith Weir