German magazine Manager Magazin has reported that Volkswagen has held talks with Fiat-Chrysler about a possible buyout, the magazine cities unnamed sources.
The owners of Fiat want to end volume production and move their focus onto Ferrari, a spokesman for VW has confirmed that no takeover talks have been held.
However Manager Magazin said VW Chairman Ferdinand Piech, has held various talks with associates and members of the Agnelli family. Fiat too have issued denials.
Piech’s interest in the Fiat group may well be to strengthen VW’s foothold in the US where it is struggling to hold onto a sales momentum. For Piech the cherry in the cake is Alfa Romeo, Fiat could well end up being a loss making disposable asset.
Upon the news going public Fiat’s shares shot up from 5.1 percent to 7.99 euros, conversely VW shares were down by 2.4 percent to 184.65 euros. VW is valued at 88 billion euros ($120 billion), Fiat at around 9.9 billion euros.
VW is cash rich and has an estimated 18 billion euros ($24 billion) burning a hole in its corporate pocket, VW has been linked to a number of acquisitions, from US truck maker Paccar to Alfa Romeo and Magnetti. Fiat Boss Sergio Marchionne is refusing to sell off Alfa at any cost.