PARIS (Reuters) -- Moves by Fiat Chrysler Automobiles to force General Motors into a merger might have been laughed out of court by now, had its CEO been anyone other than Sergio Marchionne.
After approaching the U.S. carmaker in an email, revealed and rebuffed by CEO Mary Barra, Marchionne aims to persuade its shareholders to demand a tie-up with his heavily indebted group, worth about one-third of GM.
"It's like a dog barking at an elephant," said one senior investment banker who is watching the situation closely.
If Marchionne's ambition is being taken seriously -- and the snickering in Detroit has a nervous quality -- it is mainly because of his reputation as a broker of improbable deals.
He has also bested GM before. In 2005, a year after becoming Fiat CEO, Marchionne convinced GM he was serious about forcing it to buy the loss-making Italian carmaker, using a put option agreed in happier times. Instead he walked away with a $2 billion check, then returned Fiat to profit a year later.
The 63-year-old chain-smoker also sits on the Philip Morris board, and other non-executive roles have included a directorship at UBS, now advising him on GM.
After moving to Canada from Italy as child, Marchionne qualified in both law and accountancy, giving him a detailed grasp of deal negotiations that his adversaries often lack.
In 2009, as the global financial crisis unfolded, he took control of Chrysler through an initial 20 percent stake acquired for zero cash -- stepping in after Renault-Nissan boss Carlos Ghosn got cold feet over a similar deal he had negotiated with GM's bankrupt rival.
U.S. Treasury officials later recalled that Marchionne had come to the table without the usual retinue of advisers and given hours of presentations himself, foregoing cigarette breaks.
The North American market promptly rebounded, rewarding his confidence. Chrysler returned to profit in the first quarter of 2011 and paid off its government bailout loans that May.
Marchionne's colleagues and combatants alike describe an approach at odds with his laid-back sartorial aesthetic, heavily reliant on a trademark cashmere sweater and slip-on shoes.
The bluff and brinkmanship were tested again in a year-long buyout dispute with Chrysler's then minority shareholder, a UAW healthcare trust.
After persuading union negotiators he was ready to let them force a Chrysler flotation -- adding complications and uncertainty for both sides -- Marchionne last year pulled off a $4.35 billion buyout deal mostly financed by Chrysler itself, not parent Fiat.
"If he doesn't feel he has an advantage, a situation where he can pin you against the wall, he won't open a negotiation," Italian union official Enzo Masini commented at the time.
Beyond GM's size, the merger economics are a tough sell for Fiat Chrysler, requiring factory cuts that would be challenging in the United States and unthinkable in Europe, some industry experts say.
According to Bernstein analyst Max Warburton, however, those studying the deal merits on paper may miss the point: if GM shareholders back a tie-up, they get Marchionne thrown in.
"A deal like this is about convincing shareholders that you are more credible than the incumbent management," Warburton said in a June 11 note.
"Would investors buy the idea that Sergio Marchionne could run GM better than Mary Barra? Possibly, but it won't be easy."