Fiat Chrysler and Peugeot Owner PSA Agree to Merge
October 30 2019 - 3:47PM
Dow Jones News
By Ben Dummett, Eric Sylvers and Nick Kostov
Fiat Chrysler Automobiles NV and Peugeot maker PSA Group of
France have agreed on the terms of a merger that, if approved by
both boards, would create the world's fourth-largest auto maker by
volume with a market value of more than $48.4 billion, according to
people familiar with the situation.
Peugeot's board approved the deal on Wednesday. Fiat Chrysler's
board meeting was still in progress while the board of Exor, the
Agnelli family holding company that controls the Italian-American
car maker, was scheduled to meet later on Wednesday night.
Fiat Chrysler Chairman John Elkann would become chairman of the
newly merged company while Peugeot Chief Executive Carlos Tavares
would be CEO. Both would have seats on the board of the new
company, which would comprise six Peugeot appointees, including Mr.
Tavares, and five from Fiat Chrysler.
As part of the deal, Peugeot would pay EUR3 billion to its
shareholders from the sale of a stake in auto parts maker Faurecia,
while Fiat Chrysler will pay its shareholders a dividend of EUR5
billion and would also distribute the proceeds from the sale of its
Comau unit, which is valued at about EUR250 million.
The U.S. and French governments have been briefed on the
deal.
Issues yet to be clarified include where the joint company would
be based and the size of the stakes owned by the companies' major
shareholders.
A spokesman for PSA declined to comment. A spokesman for Fiat
Chrysler couldn't immediately be reached for comment.
--Nick Kostov and Ben Dummett contributed to this article
Write to Eric Sylvers at eric.sylvers@wsj.com
(END) Dow Jones Newswires
October 30, 2019 15:32 ET (19:32 GMT)
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