Fiat on Friday sold its 1.6 percent direct stake in Italy's number two power company Edison in a roughly 100 million euros ($127.1 million) deal, the latest sale of non-core assets in a turnaround plan.
Fiat said the sale of the shares - to institutional investors via a placement handled by US bank Morgan Stanley - did not affect its 24.6-percent stake in Italenergia Bis (IEB), a holding company which controls Edison.
"The transaction announced today does not change any of the strategic options of the Fiat group in the future," the Turin-based group said in a statement.
Fiat did not mention a price for the 65 million Edison shares sold. But market sources told Reuters in London that Morgan Stanley had won the mandate to sell the 65 million shares at 1.50 euros each, valuing the deal at 97.5 million euros.
Edison shares on the Milan stock exchange were down 3.54 percent at 1.50 euros by 0845 GMT. Electricite de France (EdF) has 18 percent of IEB but could end up with 100 percent in 2005 under a series of put and call options with other shareholders including Fiat.
Fiat also said in its statement it had agreed with Morgan Stanley not to sell, directly or indirectly, any share or warrant of Edison for 60 days.