Fiat Chrysler and PSA Plan Carmaking Tie-Up to Face Expensive Future
Rival carmakers PSA Group and Fiat Chrysler Automobiles NV unveiled a plan to combine, pooling resources to confront an expensive new era of trade tariffs, emissions rules and electrification.
Shareholders of each company will own 50% of the combined entity, to be listed in Paris, Milan and New York. Investors in Fiat will receive a dividend of 5.5 billion euros ($6.1 billion) and its robotics arm Comau, while France’s PSA plans to distribute its 46% stake in auto-parts maker Faurecia SE. Cost savings from the deal without plant closures are projected to be about 3.7 billion euros.
PSA shares dropped as much as 9.1% in Paris, the most in more than three years, while Fiat rose as much as 10% in Milan.
The boards of Fiat Chrysler and Peugeot and Citroen-maker PSA agreed to work toward a binding agreement in the coming weeks, they said Thursday in a joint statement. The accord would create the fourth-largest automaker with a combined market value of about $50 billion.
Read more: https://www.bloomberg.com/news/articles/2019-10-30/psa-board-is-said-to-approve-plan-to-combine-with-fiat-chrysler?srnd=premium
