Ford suffers setbacks in Italy
Efforts to buy Ferrari and Alfa Romeo failed
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The Ferrari takeover bid ended abruptly in May 1963. After 22 days of intense negotiations, talks ended in a fusillade of Italian curses. Enzo Ferrari refused to sell his company to Ford and five years later sold a 50 percent stake to the Fiat Group.
In 1998, 35 years after the deal collapsed, Franco Gozzi, Ferrari's personal secretary, revealed the intimate details of why the deal fell through.
The problem, he said, was a clause proposed by Ford stating that Ferrari would "submit to Ford for a quick approval a general budget" - which Enzo Ferrari felt would cripple the freedom that had been promised him as racing team director.
Late-night bombshell
It was 10 p.m. on May 23, 1963. Ferrari, according to Gozzi, first said in aggressive terms that he felt betrayed - and then shouted a series of insults that Gozzi described as "words you cannot find in any vocabulary."
Finally, Ferrari murmured to Gozzi: "Let's go to eat something," leaving the 14-member Ford delegation speechless. The deal was dead.
After the sale to Fiat five years later, Enzo Ferrari retained total control of the racing department until his death in August 1988. Under terms of the agreement of 1968, Fiat bought another 40 percent of Ferrari after the death of the founder.
Another failure
Ford's attempted takeover of Alfa Romeo in 1986 was complicated by the fact that the sporty brand was owned by Finmeccanica, one of many operating subholdings of Istituto per la Ricostruzione Industriale (IRI), the main industrial holding of the Italian state.
After months of rumors and denials, Ford and IRI signed on May 20, 1986, a memorandum of understanding under which Ford would take over Alfa Romeo.
According to a 1990 book by Anna Gervasoni and Gianni Razzelli, Ford offered to take a 20 percent stake initially, with an option to raise that to 51 percent within five years and to take total control in another five years.
How much cash Ford put on the table for the initial 20 percent stake was never made public. A five-year investment plan of 4 billion lire was going to be shared with the Italian government - which would have had to fund 80 percent of the relaunch effort.
A surprise bidder
After several more months of haggling, Ford made its final offer on Sept. 25, 1986.
The next day, Fiat - which had stated that it was not interested in Alfa Romeo - announced that it was joining the bidding. It made a formal offer on Oct. 24. Fiat proposed to merge its premium brand, Lancia, with Alfa Romeo to create a premium brand group targeted to top 600,000 units annually.
Fiat planned the same investment in Alfa Romeo as Ford - but Fiat would take 100 percent of the company from the outset, freeing the Italian government from contributions.
In addition to taking on debts of more than 700 billion lire, Fiat offered more than 1 billion lire for Alfa's assets.
On Nov. 6, 1986, despite opposition from worker unions and several politicians, IRI accepted the only offer that meant immediate cash and no more liabilities.
On Jan. 1, 1987, Alfa Romeo was sold to Fiat, which incorporated it with Lancia to create Alfa Lancia Industriale.
You can reach Luca Ciferri at lciferri@crain.com.
