Chrysler 2015 Annual Report Download - page 139

2015 | ANNUAL REPORT
Consolidated
Financial Statements
Notes to the Consolidated
Financial Statements
139
Notes to the Consolidated Financial Statements
At December31, 2015 and 2014
PRINCIPAL ACTIVITIES
The FCA Merger
On January 29, 2014, the Board of Directors of Fiat S.p.A. (“Fiat”) approved a proposed corporate reorganization
resulting in the formation of Fiat Chrysler Automobiles N.V. and decided to establish Fiat Chrysler Automobiles N.V.,
organized in the Netherlands, as the parent of the Group with its principal executive offices in the United Kingdom. Fiat
Chrysler Automobiles N.V. was incorporated as a public limited liability company (naamloze vennootschap) under the
laws of the Netherlands on April 1, 2014 under the name Fiat Investments N.V.
On June 15, 2014, the Board of Directors of Fiat approved the terms of a cross-border legal merger of Fiat into its 100
percent owned direct subsidiary Fiat Investments N.V. (the “Merger”), subject to several conditions precedent.
Fiat Chrysler Automobiles N.V. was incorporated with issued share capital of €200,000, which was composed of
20,000,000 common shares having a nominal value of €0.01 each. Share capital increased to €350,000 on May 13,
2014. Fiat shareholders voted and approved the Merger at their extraordinary general meeting held on August 1, 2014
and after this approval, Fiat shareholders not voting in favor of the Merger were entitled to exercise cash exit rights (the
“Cash Exit Rights”) by August 20, 2014, which were exercised for a net aggregate cash disbursement of €417 million.
The Merger, which took the form of a reverse merger, became effective on October 12, 2014 and resulted in Fiat
Investments N.V. being the surviving entity and was renamed Fiat Chrysler Automobiles N.V. (“FCA NV”). The Merger
was recognized in FCA NV’s Consolidated Financial Statements from January 1, 2014 and FCA NV, as successor
of Fiat, was deemed to be the parent company. As the Merger is a transaction in which all of the combining entities
are controlled ultimately by the same party both before and after the reverse merger, and based on the fact that
the control is not transitory, the transition was deemed to be a combination of entities under common control and
therefore outside the scope of IFRS 3R - Business Combinations and IFRIC 17 - Distributions of Non-cash Assets
to Owners. As a result, the Merger was accounted for without adjusting the carrying amounts of assets and liabilities
involved in the transaction and did not have an accounting impact on the Consolidated Financial Statements.
Unless otherwise specified, the terms “Group”, “FCA Group”, “Company” and “FCA”, refer to FCA, together with its
subsidiaries and its predecessor prior to the completion of the Merger, or any one or more of them, as the context may
require. Any references to “Fiat” refer solely to Fiat S.p.A., the predecessor of FCA NV prior to the Merger.
Ferrari Spin-off and Discontinued Operations
On October 26, 2015, Ferrari N.V., a subsidiary of FCA, completed its initial public offering (“IPO”) in which FCA sold
10 percent of Ferrari N.V. common shares (“Ferrari IPO”) and received net proceeds of approximately €0.9 billion,
which resulted in FCA owning 80 percent of Ferrari N.V. common shares, Piero Ferrari owning 10 percent of common
shares and public shareholders owning the remaining 10 percent of common shares. The Ferrari IPO was accounted
for as an equity transaction with the effect on Equity attributable to owners of the parent as follows:
At October 26, 2015
(€ million)
Consideration received 866
Less: Carrying amount of equity interest sold (7)
Effect on Equity attributable to owners of the parent 873