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Capital market-relevant press releases, 2001-03-21, 01:00 AM

Fiat and ThyssenKrupp Automotive signed a Memorandum of Understanding for Magneti Marelli Suspension Systems and Shock Absorbers business

Fiat recently announced the decision to identify strategic alternatives for its subsidiary Magneti Marelli, a leading automotive systems and module supplier.

Fiat and ThyssenKrupp Automotive (TKA), one of the world`s largest manufacturers of automotive components and systems, have signed a Memorandum of Understanding for the acquisition of the Suspension Systems and Shock Absorbers business (MMSS) of Magneti Marelli by TKA. The parties have agreed on the essentials of an initial purchase of 51 % of MMSS and a put/call option for Fiat and TKA on the remaining shares. The option can be exercised beginning in 2004. The deal will be submitted for approval to the antitrust authorities and is subject to normal due diligence, which Fiat and TKA expect to be conducted quickly.

The estimated value of the entire transaction is euro450 million. The valuation could increase to euro550 million, on the basis of the results for the next 3 years.

MMSS is the sole supplier of complete suspension systems for all Fiat car platforms and is market leader in South America for shock absorbers with the Cofap brand. In terms of customer structure, product range and regional presence, ThyssenKrupp Automotive and MMSS are a very good fit. The acquisition of MMSS further expands TKA`s leading position as a supplier of complete chassis and suspension systems, a market segment in which high growth is forecast. The joint company will have extensive capabilities in design, engineering and electronic systems.

MMSS has 15 locations in Italy, Poland, the USA and Brazil and in 2001 will generate sales of approx. euro1.5 billion. Most of the company`s 5,500 employees are based in Italy (2,800) and Brazil (2,200).

Magneti Marelli is a leading supplier of automotive high tech components, systems and modules. With approximately 4.5 billion euros in revenues in the year 2000 and 25,000 employees, Magneti Marelli operates in 23 countries in activities ranging from powertrain systems to information and on-board communication systems, lighting systems, suspensions and shock absorbers, aftermarket and services.

In fiscal year 1999/2000 ThyssenKrupp Automotive achieved sales in excess of euro6.1 billion with around 40,000 employees. One of the world`s biggest automotive supply companies, ThyssenKrupp Automotive has more than 120 production facilities forming a global network to manufacture customized components, modules and systems on all major markets. As a systems partner and full-service supplier to leading carmakers, ThyssenKrupp Automotive - organized in the business units Body, Chassis, Powertrain and Systems/Suspensions - is involved in all phases of developing and producing automobiles and their components.

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