Chrysler 2011 Annual Report Download - page 158

157
Consolidated
Financial Statements
at 31 December 2011
The main aggregate amounts related to the Group interests in associates measured at cost are as follows:
(€ million) At 31 December 2011 At 31 December 2010 (*)
Total assets 22 82
Liabilities 868
(*) The amounts relate to the Continuing Operations.
(€ million) 2011 2010 (*)
Net revenues 44 58
Net profit/(loss) 1-
(*) The amounts relate to Continuing Operations.
Investment in Chrysler
Acquisition of control of Chrysler and subsequent acquisition of non-controlling interests
As discussed above, on 24 May 2011 (the “Acquisition date”), Fiat acquired an additional 16% (on a fully-diluted basis) of the ownership
interest of Chrysler, increasing its interest to 46% (on a fully-diluted basis). As a result of the potential voting rights associated with
options that became exercisable on that date, Fiat was deemed to have acquired control of Chrysler under IAS 27 – Consolidated and
Separate Financial Statements. Accordingly, Chrysler has been consolidated on a line-by-line basis by Fiat with effect from that date
(for practical purposes, 1 June 2011).
At 31 December 2010, Fiat held 200,000 Class B membership interests in Chrysler representing a 20% ownership interest. Those
membership interests were granted to Fiat, pursuant to the Chrysler Group Amended and Restated LLC Operating Agreement, forming
part of the broader strategic alliance entered into between Fiat and Chrysler in 2009, as consideration for technology contributed. No
cash consideration was required under the agreement.
Under the Chrysler Group Amended and Restated LLC Operating Agreement, Fiat was granted the opportunity of increasing its
ownership interest in Chrysler by a further 15% (with the number of Class B membership interests remaining unchanged at 200,000)
subject to the occurrence of three specific events (the “Performance Events”). The Performance Events are as follows:
Technology Event: regulatory approval to produce an engine in the U.S. based on Fiat’s Fully Integrated Robotised Engine, or FIRE,
family (or another engine agreed to by Fiat and the U.S. Treasury) and Chrysler Group’s irrevocable commitment to begin commercial
production of the engine;
Distribution Event: Chrysler Group’s (a) achievement of cumulative revenues, subsequent to 10 June 2009, of $1.5 billion or more
attributable to sales outside the NAFTA Region, (b) execution of distribution agreement term sheets covering (i) at least 90% of Fiat
Group Automobiles dealers in the European Union and providing for pooling of Chrysler Group vehicle fleets for EU CO2 emissions
compliance and (ii) at least 90% of Fiat Group Automobiles dealers in Brazil, in each case pursuant to which such dealers will have
the right to carry one or more Chrysler Group products, and (iii) execution of a technology license agreement that compensates
Chrysler Group for use of its technology by Fiat outside of the NAFTA Region; and
Ecological Event: requires the development of a vehicle by Chrysler Group based on a Fiat platform or vehicle technology that has
a verified unadjusted combined fuel economy of at least 40 miles per gallon and Chrysler Group’s irrevocable commitment to begin
assembly of such a vehicle in commercial quantities in a production facility in the U.S.
Following the occurrence of the Technology Event and the Distribution Event, the rights associated with Fiat’s Class B membership
interests increased from 20% to 25% in January 2011 and to 30% in April 2011, respectively. Assignment of these additional ownership
interests did not require payment of any cash consideration by Fiat or commitment to fund Chrysler in the future.