Fiat Chrysler CEO says approached by several suitors for Magneti Marelli

August 26, 2016 3:11 PM EDT

FCA CEO Sergio Marchionne addresses the media during a celebration of the production launch of the all-new 2017 Chrysler Pacifica minivan at the FCA Windsor Assembly plant in Windsor, Ontario, May 6, 2016. REUTERS/Rebecca Cook

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By Bernie Woodall

STERLING HEIGHTS, Mich. (Reuters) - Fiat Chrysler Automobiles (NYSE: FCAU) has been approached by several suitors for its components business Magneti Marelli, the carmaker's chief executive said on Friday, without giving names or mentioning how many had shown interest.

Sergio Marchionne also indicated it is still possible that FCA will continue production of the compact Dodge Dart and the midsize Chrysler 200 sedans, despite much skepticism by industry analysts about the automaker's chance of landing a production partner for sedans in the U.S. market.

"We’ll have an answer, hopefully, soon," Marchionne said, adding, "to the extent that we can share the work with somebody else, we’ll probably do it."

Marchionne said FCA is in discussions with several possible partners about "real viable options" to continue midsize and compact sedan production for the U.S. market. At the start of this year, he said the automaker would stop making the two light-selling models and look for a production partner.

Earlier this month, shares of FCA rose sharply after a report that Samsung Electronics Co Ltd <005930.KS> could buy all or part of Magneti Marelli.

Samsung has identified automotive components as a growth driver as sales in its existing businesses including smartphones have slowed. Acquiring a proven supplier such as Magneti Marelli could help it overcome the high entry barrier in an industry known for its conservatism and emphasis on track record.

Speaking to reporters at an expanded FCA stamping plant in Sterling Heights, Michigan, Marchionne declined to comment on whether FCA was in talks with South Korean tech company regarding its Magneti Marelli unit.

Marchionne reiterated that the inclusion of Magneti Marelli in FCA's portfolio was not mandatory over the long term and the carmaker would consider opportunities to leverage its expertise in electronics and automotive lighting, especially given the car industry's push into assisted and autonomous driving.

However, Marchionne is likely to desire a buyer that would ensure a stable supply of components to FCA plants, which churn out a range of products from tiny Fiat 500s to sporty Maseratis.

"In the event that we would find a strategic alliance and a way of leveraging Magneti Marelli's strength going forward ... we are ultimately open to discuss," he said, without elaborating.

He declined to discuss the future of the Brampton assembly plant in Ontario, which is part of ongoing labor talks with the Canadian union UNIFOR.

(Additional reporting by Agnieszka Flak in Milan; Editing by Matthew Lewis)

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