By George Polgar
PHILADELPHIA (CBS) – Rebuffed in public by General Motors brass, repeated overtures by Sergio Marchionne of Fiat Chrysler Automobile (FCA) proposing a combination of the two auto giants, suggests that the stage is set for a big play – and possibly an ugly fight.READ MORE: Waterford Township Schools Closed After More Than 60% Of Staff Sickened Following Luncheon
Though GM CEO Mary Barra summarily dismissed the idea proposed by FCA boss Marchionne in an email, that doesn’t completely end the discussion. As a public company with a board of directors and many stockholders, including activist investors, Marchionne could force the issue and commence the classic hostile takeover.READ MORE: Giant Supermarket Chain Opening 4 New Stores In Philadelphia, Hiring 700 Employees
Though about to take a huge hit, with a likely multi-billion dollar Federal fine for wire fraud in connection with the ignition defect recall, and what is clearly emerging as a botched cover-up, General Motors is in strong shape in the marketplace, which would make any takeover bid challenging.MORE NEWS: Philadelphia Officials Expected To Provide Update On Reopening Timeline Tuesday, Sources Say
With fuel prices low in recent years due to world oversupply, GM’s strength in the SUV and pick-up truck segments is delivering high margin sales, bolstering nearly $3 billion in profits in 2015. Though worldwide production integration could yield economies, product overlap in such a giant combination would be unwieldy.