nikhil25 Posted September 29, 2015 Share Posted September 29, 2015 Fiat Chrysler Labor Contract in Doubt UAW members at several plants have rejected the proposal, citing concerns about medical benefits and two-tier wage structure http://www.wsj.com/articles/fiat-chrysler-labor-contract-in-doubt-1443476110 United Auto Workers members began voting on the new pact last week, and a majority of union locals have turned down the proposal thus far. They are citing concerns about medical benefits, a two-tier wage structure and the auto maker’s plan to move production of key products to Mexico as reasons for disapproval. Voting will continue through Wednesday. Link to comment Share on other sites More sharing options...
gurpaul88 Posted September 29, 2015 Share Posted September 29, 2015 http://media.fcanorthamerica.com/newsrelease.do;jsessionid=FB704628B869C5F9266077E7B95031C5?&id=17016&mid=431 Link to comment Share on other sites More sharing options...
TeddyLampert Posted September 30, 2015 Share Posted September 30, 2015 https://dl.dropboxusercontent.com/u/65789707/ADW%20Capital%20Management%20Fiat_Ferrari%20Investment.pdf Link to comment Share on other sites More sharing options...
Phaceliacapital Posted September 30, 2015 Share Posted September 30, 2015 http://www.gwinvestors.com/2015/09/29/alpine-twins-in-valuation-only/ http://www.gwinvestors.com/wp-content/uploads/Slide1-1024x751.jpg http://www.gwinvestors.com/wp-content/uploads/Slide2-1024x645.jpg Most likely to cheat: Opel & Peugeot. http://www.gwinvestors.com/wp-content/uploads/screenshot-1024x510.png Valuation: http://www.gwinvestors.com/wp-content/uploads/FCA-Valuation.png http://www.gwinvestors.com/wp-content/uploads/Ferrari-Value.png Link to comment Share on other sites More sharing options...
merkhet Posted October 1, 2015 Share Posted October 1, 2015 http://www.bloomberg.com/news/articles/2015-09-30/ferrari-ipo-said-set-to-sell-out-as-investors-shrug-off-vw-fall Based on talks with potential investors, Ferrari is on track to garner the 10 billion-euro ($11.2 billion) value that Chairman Sergio Marchionne sought before the Volkswagen crisis broke, according to people familiar with the process who asked not to be identified because the arrangements are private. Initial requests for the stock may exceed the amount available by more than 10 times, one of the people said. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 1, 2015 Share Posted October 1, 2015 http://www.bloomberg.com/news/articles/2015-09-30/ferrari-ipo-said-set-to-sell-out-as-investors-shrug-off-vw-fall Based on talks with potential investors, Ferrari is on track to garner the 10 billion-euro ($11.2 billion) value that Chairman Sergio Marchionne sought before the Volkswagen crisis broke, according to people familiar with the process who asked not to be identified because the arrangements are private. Initial requests for the stock may exceed the amount available by more than 10 times, one of the people said. It blows my mind that the demand would be that high when people can literally just buy Fiat to get the remaining 80%... Seriously, Fiat must be really hated... Link to comment Share on other sites More sharing options...
muscleman Posted October 1, 2015 Share Posted October 1, 2015 http://www.bloomberg.com/news/articles/2015-09-30/ferrari-ipo-said-set-to-sell-out-as-investors-shrug-off-vw-fall Based on talks with potential investors, Ferrari is on track to garner the 10 billion-euro ($11.2 billion) value that Chairman Sergio Marchionne sought before the Volkswagen crisis broke, according to people familiar with the process who asked not to be identified because the arrangements are private. Initial requests for the stock may exceed the amount available by more than 10 times, one of the people said. It blows my mind that the demand would be that high when people can literally just buy Fiat to get the remaining 80%... Seriously, Fiat must be really hated... A lot of funds are not allowed to buy Fiat but Ferrari sounds more sexy than Fiat. Market has its moods. :) I am seriously thinking about keeping Ferrari after the spin off, depending on the price though. I think Ferrari would be an easy sell by investment banks/brokers to most investors, so the price may go up more than what we can understand. Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 1, 2015 Share Posted October 1, 2015 Fiat Chrysler Labor Contract in Doubt UAW members at several plants have rejected the proposal, citing concerns about medical benefits and two-tier wage structure http://www.wsj.com/articles/fiat-chrysler-labor-contract-in-doubt-1443476110 United Auto Workers members began voting on the new pact last week, and a majority of union locals have turned down the proposal thus far. They are citing concerns about medical benefits, a two-tier wage structure and the auto maker’s plan to move production of key products to Mexico as reasons for disapproval. Voting will continue through Wednesday. http://www.wsj.com/articles/uaw-members-reject-contract-deal-with-fiat-chrysler-1443690085 UAW Members Widely Reject Fiat Chrysler Contract Deal Rejection is a blow to union leaders who had championed the proposal as a fair bargain Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 1, 2015 Share Posted October 1, 2015 Fiat Chrysler Labor Contract in Doubt UAW members at several plants have rejected the proposal, citing concerns about medical benefits and two-tier wage structure http://www.wsj.com/articles/fiat-chrysler-labor-contract-in-doubt-1443476110 United Auto Workers members began voting on the new pact last week, and a majority of union locals have turned down the proposal thus far. They are citing concerns about medical benefits, a two-tier wage structure and the auto maker’s plan to move production of key products to Mexico as reasons for disapproval. Voting will continue through Wednesday. http://www.wsj.com/articles/uaw-members-reject-contract-deal-with-fiat-chrysler-1443690085 UAW Members Widely Reject Fiat Chrysler Contract Deal Rejection is a blow to union leaders who had championed the proposal as a fair bargain t is the first time a tentative national labor contract has been rejected by UAW members in 30 years, underscoring the level of discontent among factory workers and uncertainty about product commitments from the U.S.-Italian auto maker. I'm kind of surprised that the two tiered wage structure was ever put into place. Maybe people didn't realize how hard it would be to get rid of in the future? I mean, you have to have known that there would be major feelings of discontent if someone is making $20k more than someone else doing the same job. There are three ways to bridge that gap: 1) Raise the lower tier wages - but the reason the lower tier exists in the first place is that the company isn't competitive in pricing of all lower tier workers get a 20k raise. So this is off the table. 2) Get higher paid workers to voluntarily agree to wage cuts/caps and allows those proceeds to flow to the bottom. Probably the most economically reasonable solution and would help bridge the gap by lowering the higher tier and raising the lower tier. But how likely is it that the higher tier workers voluntarily take a pay cut/cap - I'm sure part of the reason the lower tier exists in the first place is because they were unwilling to do this in prior years. 3) Offer some sort of early retirement/severance package for higher tier workers who are willing to leave and use the proceeds to raise the wages of the lower tier. Of course, you lose a lot of experienced members in this type of process, but you would gradually raise the wages of the lower tier while phasing out the higher tier and end up with a homogeneous workforce somewhere in the middle. What a pickle! Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 5, 2015 Share Posted October 5, 2015 http://www.bloomberg.com/news/articles/2015-10-05/fiat-chrysler-offers-1-700-cash-for-volkswagen-clunkers Love it. Fiat is really trying to kick them while they're down. Hopefully it works :) Link to comment Share on other sites More sharing options...
gokou3 Posted October 5, 2015 Share Posted October 5, 2015 Ferrari to set listing price range within days: source http://www.reuters.com/article/2015/10/01/us-ferrari-ipo-idUSKCN0RV56520151001?feedType=nl&feedName=innovationNews Brokers initially valued Ferrari at between 5 billion and 10 billion euros, but recent estimates have narrowed towards the upper end, mainly due to the limited number of shares on offer. Italian media said on Thursday that preliminary demand for the shares was already at least 10 times the offering. "Ferrari is a great brand name and the stock will sell in no time," a U.S.-based investment banker said. Hopefully a positive near-term catalyst here for FCAU! Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 6, 2015 Share Posted October 6, 2015 UAW Threatening Strike at Fiat Chrysler Notification comes after efforts to salvage a labor deal voted down by members failed http://www.wsj.com/articles/uaw-threatening-strike-at-fiat-chrysler-1444150802 Link to comment Share on other sites More sharing options...
merkhet Posted October 8, 2015 Share Posted October 8, 2015 UAW Strike Averted at Fiat Chrysler http://www.wsj.com/articles/uaw-strike-averted-at-fiat-chrysler-1444278531 Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 8, 2015 Share Posted October 8, 2015 Ferrari Said to Push for $12.4 Billion Valuation in IPO http://www.bloomberg.com/news/articles/2015-10-08/ferrari-said-to-push-for-12-4-billion-valuation-in-ipo Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 8, 2015 Share Posted October 8, 2015 Ferrari Said to Push for $12.4 Billion Valuation in IPO http://www.bloomberg.com/news/articles/2015-10-08/ferrari-said-to-push-for-12-4-billion-valuation-in-ipo I'm so excited about this - have been waiting for this spin-off for a year since they mentioned it. It was my catalyst for getting into Fiat. Am blown away the market would rather buy Ferrari at $12B than Fiat at $19B....but, what do I know. I'm surprised that they haven't ramped up Ferrari's volumes prior to the IPO like Marchione had suggested, but I guess that's a reason to hold the shares unless if they take off into the stratosphere after the IPO. Link to comment Share on other sites More sharing options...
gokou3 Posted October 8, 2015 Share Posted October 8, 2015 Ferrari Said to Push for $12.4 Billion Valuation in IPO http://www.bloomberg.com/news/articles/2015-10-08/ferrari-said-to-push-for-12-4-billion-valuation-in-ipo I'm so excited about this - have been waiting for this spin-off for a year since they mentioned it. It was my catalyst for getting into Fiat. Am blown away the market would rather buy Ferrari at $12B than Fiat at $19B....but, what do I know. I'm surprised that they haven't ramped up Ferrari's volumes prior to the IPO like Marchione had suggested, but I guess that's a reason to hold the shares unless if they take off into the stratosphere after the IPO. I think FCA purposely hold back on some good news so that they can spin off the other 80% of Ferrari shares on strength, which is important for FCA shareholders. The market loves a stock that keeps going up and up. Link to comment Share on other sites More sharing options...
kranthi_vic Posted October 8, 2015 Share Posted October 8, 2015 Should we expect a proportional increase in FCAU shares after the Ferrari IPO? As current FCAU holders will not get the Ferrari shares until next year? Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 8, 2015 Share Posted October 8, 2015 Should we expect a proportional increase in FCAU shares after the Ferrari IPO? As current FCAU holders will not get the Ferrari shares until next year? I would expect it to be close, but you never know. There's no real way to arbitrage it tightly - someone could go long fiat and short F/GM if things get too out of hand, but that's not a direct hedge so you'll see fewer people doing it. Link to comment Share on other sites More sharing options...
portfolio14 Posted October 8, 2015 Share Posted October 8, 2015 I think FCA purposely hold back on some good news so that they can spin off the other 80% of Ferrari shares on strength, which is important for FCA shareholders. The market loves a stock that keeps going up and up. I don't understand this "holding back" argument. (I think ADW Capital said something similar in their analysis.) Sergio's rationale to IPO only 10% is to let the market set a "correct" (and high) valuation of Ferrari so that when shareholders get the distributed Ferrari shares early next year, they get the best value out of it. So, the aim is to maxmise shareholder value. If so, what does "holding back" achieve for the shareholders?? Another thing I don't understand Sergio is, he structured this Ferrari thing to benefit mainly shareholders directly, not FCAU the business. Why? e.g. He could've structured the deal differently to deleverage FCAU more instead of returning capital to sharesholders. That will be my preference. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 8, 2015 Share Posted October 8, 2015 I think FCA purposely hold back on some good news so that they can spin off the other 80% of Ferrari shares on strength, which is important for FCA shareholders. The market loves a stock that keeps going up and up. I don't understand this "holding back" argument. (I think ADW Capital said a similar thing in their analysis.) Sergio's rationale to IPO only 10% is to let the market set a "correct" (and high) valuation of Ferrari so that when shareholders get the distributed Ferrari shares early next year, they get the best value out of it. So, the aim is to maxmise shareholder value. If so, what does "holding back" achieve for the shareholders?? Not to mention, the greater production would have led to greater profits that FCA could use to drive a higher valuation which would drive more money going to fund their capital plans. I think that ramping up the volume would have been a better idea BEFORE the IPO, but TBH, it doesn't matter much. I don't see that as a major misstep - just a transfer of wealth from FCAU to Ferrari. Link to comment Share on other sites More sharing options...
rohitc99 Posted October 8, 2015 Share Posted October 8, 2015 I think FCA purposely hold back on some good news so that they can spin off the other 80% of Ferrari shares on strength, which is important for FCA shareholders. The market loves a stock that keeps going up and up. I don't understand this "holding back" argument. (I think ADW Capital said a similar thing in their analysis.) Sergio's rationale to IPO only 10% is to let the market set a "correct" (and high) valuation of Ferrari so that when shareholders get the distributed Ferrari shares early next year, they get the best value out of it. So, the aim is to maxmise shareholder value. If so, what does "holding back" achieve for the shareholders?? Not to mention, the greater production would have led to greater profits that FCA could use to drive a higher valuation which would drive more money going to fund their capital plans. I think that ramping up the volume would have been a better idea BEFORE the IPO, but TBH, it doesn't matter much. I don't see that as a major misstep - just a transfer of wealth from FCAU to Ferrari. If one looks at it from the controlling shareholders point of view, they would be better served if this ramp and higher volumes comes as part of ferrari. the market could discount the same cash flow in FCAU much more than ferrari. so if you spin off ferrari, every extra dollar in growth gives a higher valuation. i guess as minority shareholders we benefit from the same dynamics. Link to comment Share on other sites More sharing options...
portfolio14 Posted October 8, 2015 Share Posted October 8, 2015 Another thing I don't understand Sergio is, he structured this Ferrari thing to benefit mainly shareholders directly, not FCAU the business. Why? e.g. He could've structured the deal differently to deleverage FCAU more instead of returning capital to sharesholders. That will be my preference. Link to comment Share on other sites More sharing options...
Guest Grey512 Posted October 8, 2015 Share Posted October 8, 2015 Out of curiosity: for those who are long FCAU just to get their hands on Ferrari or to get a pop in FCAU as the value of the brand portfolio is highlighted at IPO, what are you planning to do with your FCAU stock afterwards? Sell it? If you are planning to hold on to it, what would you do if FCAU suddenly went to €6? Just would like to caution you that this is a super-crowded name. Many European event-driven HFs are in it. If and when the selling starts, FCAU could correct significantly. If you are a long-term bull on FCAU, then great, opportunity for you to buy more. Link to comment Share on other sites More sharing options...
Picasso Posted October 8, 2015 Share Posted October 8, 2015 Reminds me of Softbank/Yahoo during the Alibaba IPO regarding how crowded the event driven guys are in this. Link to comment Share on other sites More sharing options...
Guest Grey512 Posted October 8, 2015 Share Posted October 8, 2015 Picasso - thank you. The thing is, FCAU was super-crowded even back in Dec-2014! And it only got more crowded.. If it was 60% less crowded then maybe I would get back in. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now