In Aug 2 MILAN story headlined "UPDATE 1-Italy's Fiat to sell Teksid unit", please read in third paragraph ...which made about 866 million euros last year, accounting for about 1.5 percent of Fiat's turnover... instead of ...accounted for about three percent of Fiat's turnover and made about 1.7 billion euros last year ... (corrects figures)
A corrected repetition follows:
MILAN, Aug 2 (Reuters) - Troubled Italian carmaker Fiat on Friday announced an agreement to sell the aluminium unit of its Teksid casting subsidiary, recording a net gain of 290 million euros, as the group struggles to cut large debts.
The deal, worth around 460 million euros, will see the aluminium automotive components business sold to a group of funds including JP Morgan Partners , U.S.-based Questor Management Company and Italy's Private Equity Partners, Fiat said in a statement.
Sale of the aluminium unit, which made about 866 million euros last year, accounting for about 1.5 percent of Fiat's turnover, will represent one of the first spin-offs of Fiat's non-core operations since the industrial group announced a strategic restructuring in May.
Fiat is aiming to raise 3.2 billion euros through the sale of non-core assets while it tries to slash net debt to 3.0 billion euros by December from 5.8 billion euros at the end of June.
Fiat sold 34 percent of its racing car unit Ferrari for 775.2 million euros at the end of June.
Slowing car sales pulled Fiat to a group operating loss of 127 million euros in the second quarter, when its core auto unit posted an operating loss of 394 million euros.
Faced with increasing losses and high debt, Fiat has had to batter out a three billion euro emergency financing package with creditor banks.
According to the plan, the industrial must cut its net debt to 3.0 billion euros and its gross debt to 23.6 billion euros by the time 2002 accounts are approved, probably in March 2003.
The Teksid transaction, which requires regulatory approval from the European Union, the United States and certain other countries, is expected to close by late September.
The aluminium automotive components business includes plants in the United States, Italy, France, Poland, Mexico, Brazil and Argentina, and joint venture facilities in Turkey and China.
Products include aluminium cylinder heads, engine blocks, transmission casings and suspension components.
Automotive and transportation companies have been among the most important enterprises in portfolios of the Questor funds.
Lazard advised Fiat on the deal.