Fiat appears to have gained ground in negotiation to buy by shares in the Chrysler Group.

Sources close to a valuation of Chrysler, have reported to Bloomberg that the company has been valued at $10 billion, which comes in under original expectations.

Fiat is looking to acquire holdings held by the United Auto Workers (UAW), with the rumoured valuation making these holdings now worth $4.15 billion.

The UAW will now have to decide on whether it will sell to Fiat or move to bidding out to a public offering.

Fiat saw its stock rise by 1.4 per cent at the end of trading last week in Milan, with the company having gained 57 per cent this year.