TURIN -- The management of Italian carmaker Fiat SpA is expected to meet the group's creditor banks towards the end of this week to discuss the turnaround of the ailing industrial giant, a financial source said Monday.
The anticipated meeting comes amid speculation Fiat's management and the leading Agnelli family shareholders are sceptical about spinning-off core unit Fiat Auto, a solution favoured by some banks and want an alternative medicine.
Fiat did not attend a meeting of its main creditor banks on Monday, contrary to expectations the two sides would discuss the relaunch of the industrial group's cash-bleeding car arm. The four banks issued no statement after the meeting.
Ten days after the death of Fiat patriarch Gianni Agnelli, Fiat's management and its banks are looking at rescue options for the industrial empire he once headed. Thousands of jobs are at stake, as well as the survival of Italy's car industry.
"We are experiencing a difficult moment, but we will come out of it together with our heads held high," said Umberto Agnelli, Gianni's brother, who may takeover Fiat's chairmanship.
Gianluigi Gabetti, vice chairman of the Ifi holding that controls Fiat, earlier said Fiat's board would also meet "soon but not this week" to discuss revival plans.
Fiat Chairman Paolo Fresco, at a memorial with Gabetti for Gianni Agnelli, said the Turin-based group was in talks "as always" with U.S. partner General Motors Corp., but there was "nothing specific" on the agenda.
Newspapers have reported that GM could inject between 1.75 billion and two billion euros into the auto unit, raising its current 20 percent stake in Fiat Auto to 30 percent or 40 percent.
In exchange, Fiat would drop an option that could require GM to buy the remaining 80 percent of Fiat Auto from 2004. But Fiat CEO Alessandro Barberis has rejected any sale of Alfa Romeo and the Brazilian operations to GM as part of the package, Italian newspapers reported on Saturday.
Barberis has been reported to be planning to go to the United States to meet GM, whose board is set to meet on Tuesday.
Fiat, formerly Europe's largest carmaker, faces tough competition in the Italian market it long dominated.
Fiat's market share gained some traction in January, edging above 30 percent from an historic low of 27.8 percent in January, senior Fiat Auto executive Gianni Coda said Monday.
The car unit is expected to report a roughly two billion euro net loss in 2002 and has dragged the Fiat group into losses.
Monday's meeting between key creditor banks Intesa, Sanpaolo IMI, UniCredito and Capitalia , came as banking sources said Fiat would complete the key sale of 51 percent of Fidis to the banks by Feb. 11.
Fiat said in December the planned sale of the stake in customer financing arm Fidis to its four top creditor banks would knock about six billion euros off its gross debt, which stood at 32.8 billion euros at the end of September.
Ratings agency Moody's Investors Service in December cut the group's credit rating to junk status amid concern about its debts.