Fiat, GM executives meet in NY
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NEW YORK (Reuters) -- Top executives of troubled Italian automaker Fiat met on Sunday with their counterparts at General Motors, but no news emerged on what role GM could play in Fiat's last-ditch turnaround bid.
Fiat Chairman Paolo Fresco and Chief Executive Alessandro Barberis met with top GM executives for a little over five hours but declined to comment before or after the long anticipated gathering at GM's New York headquarters.
A Fiat spokesman also declined to comment.
GM (GM) owns 20 percent of Fiat's crisis-hit car unit which is believed to have posted an operating loss of about 1.35 billion euros in 2002 as it struggles with sliding sales and a stubborn debt burden.
The talks are believed to have focused on Fiat's option to force GM to buy the remaining 80 percent of the auto division it does not own starting next year.
As Fiat looks for about 5.0 billion euros to fuel its latest recovery bid, speculation has swirled that it would free GM from the obligation to buy the rest of Fiat Auto in return for a cash contribution of about two billion euros upfront.
But some media reports have said that GM remained hesitant about pumping additional funds into Fiat. A financial source has told Reuters that Fiat's board would discuss a capital hike of about 2.5 billion euros on February 28.
At the same time, Fiat is in talks to sell two of its corporate jewels, insurer Toro and aviation unit Fiat Avio, deals which could bring in an estimated three billion euros.
Uncertainty about the turnaround bid helped drive Fiat shares to an 18-year low on Friday, a plunge also fueled by speculation that the company will issue new shares at a substantial discount to the current market price.
