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KKR Reportedly In Talks To Buy Fiat Chrysler's Magneti Marelli Auto Parts Unit

U.S. buyout firm KKR & Co. (KKR) is in talks to acquire Fiat Chrysler Automobiles N.V.'s (FCAU) global auto parts business Magneti Marelli, the Wall Street Journal reported citing people familiar with the matter.

The Journal reported that the potential sale price couldn't immediately be learned. Magneti is valued around 3.23 billion euros by some analysts, suggesting the sale price could exceed that level. Talks could still collapse before a final agreement is reached.

A possible deal comes at a time when FCA's newly appointed Chief Executive Mike Manley is tasked with managing the auto maker's lower margin businesses in Europe following the death last month of his predecessor Sergio Marchionne.

Magneti employs over 40,000 people, making a range of auto components. It generated revenue of 7.9 billion euros in 2016 according to the company's website.

KKR is expected to acquire Magneti through Japan-based Calsonic Kansei Corp., according to the report, creating an auto parts giant that could cut costs by eliminating overlapping operations. The New York-based PE firm acquired Calsonic last year from Nissan and other shareholders for about $4.5 billion.

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