FIAT CONVERTIBLE BOND OPTION UNDER STUDY
Sources close to the Italian state credit
institution (Istituto Mobiliare Italiano - IMI) said a
convertible bond issue was one of the possibilities being
studied to facilitate market absorption of Fiat shares sold
last year by Libya and still in the hands of banks.
    The sources could give no further details of the options
under study.
    A Fiat spokesman contacted by Reuters said the company had
no comment to make on the possibility of a convertible bond
issue, saying any decision to be taken "did not depend on Fiat."
    Italian press reports that a bond issue was under study
pushed Fiat's shares higher on the Milan bourse today.
    The company's ordinary shares closed in Milan today at
12,540 lire in Milan today, up from a closing 12,195 Friday.
    Fiat preference shares and savings (non-voting) shares
gained even more strongly, closing at 7,740 and 7,841 lire
respectively against 7,353 and 7,600 Friday.
    Bourse dealers say the fall in value of Fiat stock over the
last six months partly reflects selling by foreign operators of
shares acquired as a result of the 2.1 billion dlr equity offer
after Libya sold its minority stake last September.
    On September 23, 1986, the day Fiat announced it had
reached an agreement under which Libya would sell its 15 pct
stake, Fiat shares closed in Milan at 16,600 lire. Since then,
the trend has been down.
    Last September's share offer, which triggered criticism by
underwriters about the handling of the sale, opened at a
substantial discount to its offer price, resulting in losses
for holders of the shares.
    Some analysts have said the size of offer was too big for
the market to handle efficiently.
 REUTER
