May 12 (Bloomberg) — Chrysler Group, the automaker owned by Fiat SpA, lost $690 million in the first quarter when it bought the shares held by a union retiree medical trust, paving the way for integration of the companies.

Chrysler reported a modified operating profit of $586 million, before about $1.2 billion in charges related to the stock transaction with the United Auto Workers union health-care trust. Marchionne said last week that recall costs also hurt Chrysler's profit.

Chrysler, which had reported 10 straight profitable quarters, has provided most of the income for what is set to become Fiat Chrysler Automobiles NV later this year. The combined company, with a listing in New York and headquarters in London, will be the world's seventh largest, said Sergio Marchionne, the chief executive officer of both automakers.