Motoring
Chrysler pushes IPO to 2013
MILAN – The planned stock market listing of Fiat’s (FIA.MI) U.S. unit Chrysler will not take place this year, the Italian carmaker said on Monday, prolonging the uncertainty over its chances of buying out the rest of the company.
The initial public offer, which Fiat CEO Sergio Marchionne had previously said could take place in 2013, was expected to shed light on the U.S. carmaker’s value and help settle a long-running spat between Fiat and a healthcare trust which owns 41.5 percent of Chrysler.
“The Board of Directors of Chrysler Group … has determined that it will not be practicable for Chrysler Group to launch and complete an initial public offering prior to the end of 2013,” Fiat said in a statement.
It said it expected Chrysler to work towards an IPO in the first quarter of 2014, but added it could not say if and when such an offer would happen as it would depend on “market conditions and other relevant considerations”.
Fiat, which has a 58.5 percent stake in Chrysler, wants to buy the rest of the U.S. carmaker, but has not been able to agree a price with the United Auto Workers (UAW) union, which owns the rest via its retirees’ healthcare trust VEBA.
Chrysler filed paperwork for an IPO in late September.
Investors had hoped that the preliminary work for the IPO of part of the VEBA stake might have helped narrow the difference between the two sides, and that they could reach a deal without carrying out the share sale.
“Nobody really believes there will be an IPO, but any delay in the IPO process means there will be a delay in the two parties striking a deal,” a Milan-based analyst said. “The stock is reacting on the uncertainty.”
Fiat shares fell as much as 3 percent after the statement, and were down 3.1 percent at 5.77 euros by 1532 GMT, compared with a 0.45 percent fall in Milan’s blue-chip index .FTMIB.
According to the Wall Street Journal, Chrysler expects to raise between $1.5 billion and $2 billion in the IPO. Based on the 16.6 percent stake that the trust has demanded the company register for the IPO, this would imply a total value for the U.S. firm of between $9 billion and $12 billion.
Fiat declined to comment on the report, while Chrysler could not immediately be reached. Some analysts have said the company is worth around $10 billion.
Marchionne, the CEO of Fiat and Chrysler, wants to merge the two firms to create the world’s seventh-largest carmaker.
The UAW became Chrysler’s second-largest shareholder when the automaker emerged from bankruptcy in 2009 and the union took a stake in place of future healthcare payments. VEBA manages those healthcare benefits on behalf of the union.
Chrysler, which Fiat has been running since a bailout deal with the U.S. government, is now a profit centre for Fiat.
The Italian carmaker has been hurt by sagging sales for automobiles in Europe, while Chrysler’s home North American market has seen sales rise nearly 50 percent since 2009.
The Chrysler buyout talks are being closely watched by debt and equity investors, because Fiat’s long-term plan to cut losses in Europe depends on its ability to easily and cheaply share technology, cash and dealer networks with Chrysler.
Chrysler and Fiat currently are forced to manage their finances separately. A full merger would make it easier – but not automatic – to combine the cash pools of the two companies, giving Fiat more funds to expand its product lineup.
– REUTERS
Motoring
FCTA Pulls Plugs On Taxi Rank, Terminal Services Contracts
The Federal Capital Territory Administration (FCTA) has ended contracts with taxi rank and terminal operators due to their failure to meet engagement terms and conditions.
Mr. Ubokutom Nyah, the Mandate Secretary of the Transportation Secretariat, FCTA, made this announcement during a meeting with managers of these terminals and taxi ranks in Abuja.
Nyah clarified that due to the operators’ failure to fulfill their engagement terms, the FCTA had to terminate their contracts.
He instructed them to transfer control of the ranks to the Administration within three months, starting from Nov. 21.
He lamented the presence of unauthorized motor parks in the city and assured the readiness of the Administration to establish proper taxi ranks and terminals in the capital.
He revealed that personally visiting the city’s taxi ranks, terminals, and unauthorized motor parks gave him direct insight into the poor condition of these facilities.
He emphasized that as the federal capital city, Abuja deserves better, highlighting that the poor condition of these facilities attracts various criminal elements.
He said “We must rid Abuja of all these. I have gone round the taxi ranks, and of all the places I visited, not one is worthy to be called even a village motor park.”
The Mandate Secretary stressed that the intention wasn’t punitive; rather, it aimed to revamp the sector, introduce new engagement terms, and modernize taxi ranks and terminals in the federal capital.
He also highlighted the plan to increase the number of terminals and ranks where necessary, which would positively impact the administration’s revenue.
He emphasized that this measure was part of a broader effort to eliminate illegal motor parks in Abuja and curb the associated criminal activities.
In response, Mr. Adebisi Lawal, the Operator of Jahi Taxi Rank, praised the administration’s initiative to modernize the taxi ranks and terminals.
Lawal urged the administration to prioritize current operators’ involvement in the selection of new developers for the modernization of the taxi ranks and terminals.
Motoring
Power Show Sees Soldiers Batter LASTMA Officer
It was a show of power at the Ojota area of Lagos on Monday as soldiers pummeled an officer of the Lagos State Traffic Management Authority, (LASTMA).
Eyewitness accounts claim that the ugly scene played out around 8am, and saw about eight soldiers pounce on the yet to identified LASTMA official, while his colleagues took to their heels.
The video of the melodrama has gone viral, where the LASTMA official was appealing to the soldiers, who appeared bent on ‘teaching him a lesson’.
This onslaught comes on the back of a reported assault of a soldier at the same location by LASTMA officials last week.
It would appear that what played out today was the army asserting its authority and defending their khaki as the armed soldiers carried out what looked like a revenge mission.
Eyewitnesses further averred that the victim was rushed to a nearby hospital, after the soldiers left the scene.
It was gathered that the authorities at LASTMA has reported the incident to the military authorities who are said to be looking into the matter.
Meanwhile many members of the public are rejoicing that the soldiers have taught the crude LASTMA official that power is stronger than power, for all their atrocities against motorists on Lagos roads.
Motoring
Intra-City Fares Skyrocket By 98% Month-On-Month – NBS
The impact of the removal of subsidy on Premium Motor Spirit (PMS), otherwise known as petrol, has seen the pump prices of the product skyrocket with a corresponding increase in the cost commercial transportation in Nigeria.
According to the National Bureau of Statistics (NBS), intra-city bus transportation fares across Nigerian cities, measured between May and June 2023, increased from N649.59 to N1,285.41 in June 2023.
This translates to 98 percent growth or N635.82 within the month in view.
The NBS made the data available in its Transport Fare Watch report for June 2023.
In the report, the NBS also shared the breakdown of bus journeys within the cities per drop for constant routes; bus journey intercity (state route); charges per person, amongst others.
On a year-on-year basis, the report has it that bus fares rose by 120.63 percent from N582.61 paid by commuters in June 2022.
The average fare paid by commuters for bus journey intercity per drop rose to N5,686.49 in June 2023 compared to N4,002.16 in May 2023 indicating an increase of 42.09 percent, month-on-month.
The report read, “The average fare paid by commuters for bus journeys within the city per drop increased by 97.88 per cent from N649.59 in May 2023 to N1,285.41 in June 2023.
On a year-on-year basis, it rose by 120.63 per cent from N582.61 in June 2022.
“In another category, the average fare paid by commuters for bus journey intercity per drop rose to N5,686.49 in June 2023, indicating an increase of 42.09 on a month-on-month basis compared to N4,002.16 in May 2023.
“On a year-on-year basis, the fare rose by 55.25 per cent from N3,662.87 in June 2022.”
Biztellers reported that the twin forces of forex pressure and increasing price of Brent in the global market would likely see the pump prices of petrol, increased again in no distant time in Nigeria.