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Thursday April 30, 2009

Obama announces Fiat- Chrysler deal

Accord offers chance for brilliant future, president says
(see related coverage) (ANSA) - Washington, April 30 - United States President Barack Obama announced on Thursday that Chrysler had reached an agreeement with Italian automaker Fiat.

'The agreement with Fiat offers Chrysler a chance for a brilliant future,' said Obama.

Chrysler will not only survive but will prosper in its alliance with Fiat, said the president, who announced that the American automaker would file for Chapter 11 bankruptcy.

Bankruptcy was the only option available for Chrysler after negotiations between the US Treasury and the automaker's lenders failed to fully reduce Chrysler's debt.

The US government is ready to give America's No.3 carmaker up to 3.5 billion dollars in debtor financing to help Chrysler during its restructuring phase.

The Canadian government is also ready to do its bit, Obama administration sources said.

US officials are apparently in favour of letting Bob Nardelli retain his his job as Chrysler's Chief Executive for a transition period, American media sources said.

Nardelli is expected to resign once the deal with Fiat becomes operative.