DETROIT (AP) — On the heels of a profitable third quarter, Chrysler Group said it will proceed with a public offering of shares before the end of this year.
Italy's Fiat SpA owns the majority of Chrysler shares. Sergio Marchionne, who runs both companies, wants to combine them by purchasing the 41.5 percent of Chrysler now controlled by a United Auto Workers-run trust.
The two sides disagree on the value of the trust's shares, and on a conference call Wednesday, the CEO said the two sides still haven't reached a deal.
"We are now bent on executing the IPO," he said.
The IPO would consist of shares currently held by the trust. Last month, UBS AG set the value of the trust's stake at $5.6 billion. Fiat has gone to court seeking a judgment on the price, but the trial date is set for next September.
The news added drama to an otherwise unsurprising third quarter.
Chrysler's net income rose 22 percent to $464 million as strong U.S. sales of the Ram pickup and Jeep Grand Cherokee masked weaknesses elsewhere. It was the Auburn Hills, Mich.-based company's ninth consecutive profitable quarter.
Worldwide vehicle sales totaled 603,000, up 8 percent from a year ago.
They might have been higher, but the company delayed shipments of more than 30,000 new Jeep Cherokees to fix issues with its new nine-speed transmission. Scheduled to go on sale in September, the Cherokee began arriving at dealers last week.
The delay was partly responsible for Chrysler's $400 million drop in free cash flow during the quarter. Marchionne said Chrysler's U.S. dealers should be fully stocked with the new Cherokee by mid-November.
Marchionne said shutting down a plant for more than a year in preparation for the Cherokee was "painful," and vowed not to repeat that for any future vehicle.
"We were naive in thinking that it would be a seamless introduction," he said.
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