Strategist Sees 'Defensive' Posture At Fiat Chrysler Automobiles NV

Fiat Chrysler Automobiles NV FCAU wants to cut debt and gain market share, a strategist told Benzinga Wednesday. The London-based company plans to spin off a stake in its Ferrari unit later this year and had hoped to get an acquisition offer from General Motors Corp. GM. "If you look at their balance sheet, it makes sense for them to deleverage themselves," Recon Capital Chief Investment Officer Kevin Kelly told Benzinga. At GM's annual shareholders meeting Tuesday, Chief Executive Mary T. Barra reportedly rejected the notion of a hook up. http://www.reuters.com/article/2015/06/09/us-gm-fiat-chrysler-idUSKBN0OP1IR20150609 Fiat Chrysler "is trying to make a lot of moves," Kelly said. "We see it as a way to gain market share whether it's through a strategic partnership or an IPO for Ferrari." Kelly called Fiat Chrysler's interest in a merger "defensive." The company has reportedly contacted other automakers about a merger, including its Chinese joint venture partner Guangzhou Automobile Industry Group Co. Fiat Chrysler in October unveiled its intention to spin off a 10 percent stake in its luxury unit Ferrari as part of a plan to boost capital by $5 billion. http://www.fcagroup.com/en-US/media_center/fca_press_release/FiatDocuments/2014/october/FCA_Announces_Board_Intention_to_Spin_Off_Ferrari_S_p_A_.pdf The spin off won't hit the market until Oct. 12 at the earliest because of tax rules, Fiat-Chrysler Chief Executive Sergio Marchionne last week told The Wall Street Journal last week. http://www.wsj.com/articles/fiat-chrysler-delays-ferrari-ipo-1433521014 The offering had previously been expected as early as July and Marcionne has publicly discussed increasing the stake to be spun out above 10 percent. http://www.wsj.com/articles/fiat-chrysler-may-sell-more-of-ferrari-in-ipo-sale-1425404742