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Shares soar as Fiat clinches control of Chrysler

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Shares soar as Fiat clinches control of Chrysler

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Shares in Italian carmaker Fiat surged by 15 percent on Thursday morning, with the news that it is to take full control of Chrysler.

Fiat already had a majority stake in the US automobile giant. Now the remaining 41 percent, controlled by a workers’ trust fund, is being bought in a 4.3 billion dollar deal that ends long and difficult negotiations.

Fiat Chief Executive Sergio Marchionne has run both firms since Chrysler’s US government-funded bankruptcy restructuring in 2009.

He aims to create the world’s seventh-largest auto group.

The transfer of shares should be completed later this month.

It will allow Fiat to merge Chrysler’s operations entirely with its own, improving profitability by exploiting badly-needed economies of scale.

However it remains to be seen whether a merger will be enough to cut the Italian firm’s losses in Europe.