DETROIT - General Motors, which owns 10 percent of Fiat Auto, could soon be forced to buy the rest of the ailing automaker, but a leading auto industry analyst on Wednesday said such a move was highly unlikely.
"We really don't see that Fiat Auto is going to end up in GM's hands," Standard & Poor's analyst Scott Sprinzen said on a conference call.
He spoke when asked about Fiat SpA's "put" option with GM, which was agreed in 2000 and could allow Italy's largest industrial group to sell its own stake in Fiat Auto to GM as early as next January.
Fiat insists the option is valid. But GM contends a recapitalization and other actions Fiat took under a recent recovery plan annulled the put.
The two sides have given themselves until December to sort things out. But short of some amicable agreement, Sprinzen said GM was likely to take legal action to prevent Fiat from exercising the put.
"That could all be tied up in the courts for a long, long time," Sprinzen said.
As a credit analyst, Sprinzen has regular meetings with top GM executives.
The S&P conference call came after the credit rating agency affirmed its ratings for GM, Ford Motor Co. and DaimlerChrysler AG but said the outlook for GM remained negative.