Hyundai eyeing-up FCA takeover

Hyundai is secretly plotting a takeover bid of Fiat Chrysler Automobiles (FCA), says a new report.

According to the

Speaking to sources close to the Korean car-maker, the Asian news network says Hyundai CEO Chung Mong-koo is banking on FCA's share price plummeting once Marchionne leaves, providing an ideal opportunity for a hostile takeover.

According to the report, assisting the potential FCA share price decline is a lack of new models, poor investment in new technology and no real pure-electric vehicle strategy.

Hyundai has not responded to the rumours, but it's reportedly pushing ahead with its takeover plans because it wants to benefit from FCA-owned Chrysler brand's huge US dealer network.

The Korean car-maker is also said to be envious of the profitable Jeep brand and backs plans for RAM truck expansion.

It's not the first time Hyundai has considered snapping up FCA. In the past the two car-makers were in talks to form a technical partnership.

Adding pressure to Hyundai's takeover bid are other reports that Chinese car-maker Great Wall is also considering a merger with FCA – although that deal is almost certain to be blocked by US president Donald Trump's administration, says the Asia Times.

The irony of Hyundai's timing is that, in the past, Marchionne has been a huge advocate of mergers.

The outspoken CEO has long called for mergers as he believes they are the only solution to car-makers remaining profitable given the huge investment needed for the transition to pure-electric and fully autonomous cars.

In 2015, Marchionne sought a deal that would have seen FCA join forces with General Motors, only to be thwarted by the US auto giant's management.

A similar tie-up with the Volkswagen Group also proved unsuccessful.

Hyundai Motor Group, which also owns Kia, is currently the world's fifth largest car-maker, but if it joined forces with FCA it would become the world's largest car-maker, producing a total of almost 12 million vehicles per year.

According to analysts, the stock market has already given the merger its blessing with hedge fund Elliot Management -- which has a $1 billion stake in the Korean car-maker and is also described as a 'major shareholder of FCA' -- willing to push through the deal.

It's also been rumoured that FCA chairman, John Elkann, will support the FCA-Hyundai alliance as he disagrees with Marchionne over his choice on a successor.