BY JEFF BENNETT

Italian auto maker Fiat SpA is expected to increase its stake in Chrysler Group LLC to 61.9% from 58.5% as early as next week by purchasing shares held by a large trust fund that provides health care for retired union workers, people familiar with the matter said.

Fiat would exercise an option to buy a small number of shares in Chrysler from the United Auto Workers retiree healthcare trust early next week, these people said. The option allows Fiat to buy a 3.3% stake. In rounded figures, that will increase Fiat's stake to 61.9%

The transaction would be the first ...