Fiat Chrysler and Peugeot talk about the benefits of a full merger

Fiat Chrysler and Peugeot talk about the benefits of a full merger

October 31, 2019 0 By autotimesnews

The merger into one group will allow Fiat Chrysler Automobiles (FCA) and PSA Group (Peugeot-Citroen) to become the fourth largest global automaker

Fiat Chrysler Automobiles (FCA) and PSA Group (Peugeot-Citroen) announced their intention to merge with an equal number of interest holders – 50:50. The full merger will allow companies to become the fourth largest global automaker with annual sales of 8.7 million vehicles. This was reported by the PSA press service.

If combined, the total revenue of the FCA and PSA will be about $ 190 billion with an annual net revenue of $ 12.2 billion. By preliminary agreement, the two parties will establish a new management company in the Netherlands, which will be registered on the New York and Italian stock exchanges, as well as in Euronext.

The new board of directors will have 11 members: five each from FCA and PSA, and the chairman will be the current CEO of Peugeot-Citroen Carlos Tavares. The company also noted that the merger will not lead to the closure of any of the plants.

Rumors about business combinations by FCA and PSA appeared a few months ago, but they have received official confirmation only now. The merger will allow two automakers to significantly reduce the cost of developing new models, as well as reduce the cost of manufacturing cars.

In the spring of 2019, Fiat Chrysler negotiated a merger with Renault, but then abandoned this idea. The FCA explained the decision by the lack of confidence in the support of the French government, without which there can be no acceptable conditions for business development.