U.S. auto giant Chrysler LLC would have its management shifted from Michigan to Italy in the event of bankruptcy, people connected to the negotiations said.

The deadline for Chrysler to strike cost-cutting deals and a partnership with Fiat of Turin, Italy, is Thursday. If the company files for bankruptcy, however, U.S. and Canadian governments would provide about $4 billion with 80 percent from United States, The Washington Post reported Wednesday.

A bankrupt Chrysler would emerge 55 percent owned by the United Auto Workers, 35 percent by Fiat, 8 percent by the United States and 2 percent by the Canadian government.

A company of Chrysler's size majority owned by a union is unprecedented on this scale, said University of California-Berkley Professor Harley Shaiken, a labor relations expert.

Creditors would receive $2 billion, but no stake in the emerged company.

That leaves Cerberus Capital Management, Chrysler's current owner, which would be get nothing.

Fiat intends to join forces with Chrysler even if it files for bankruptcy. Fiat Chief Executive Officer Sergio Marchionne is in Washington, ready to sign an agreement, The Detroit News reported.

President Barack Obama said Wednesday that a Fiat tie-in allows Chrysler to start making fuel-efficient, clean-energy cars that'll meet the needs of future markets.