Fiat Chrysler and Peugeot boards accept the auto merger

The board of directors of the French and Italian car manufacturers Fiat Chrysler and Peugeot have accepted the auto merger as equals. This statement from the companies confirms the earlier media writing this week. The shareholders of each company would own 50% of the equity of the newly combined group.

According to the companies, this new combination will create the 4th largest global auto company with 8,7 million vehicles annually. The strength areas would be the FC´s in the North America and Latin America and Peugeot PSA´s strength in Europe. The brand areas would include luxury, premium, mainstream, passenger car, SUVs and Trucks.

-The merged entity would bring together the companies’ extensive and growing capabilities in the technologies shaping the new era of sustainable mobility, including electrified powertrain, autonomous driving and digital connectivity, the companies say in the press release.

The Fiat Chrysler and Peugeot estimate that the annual run-rate synergies would be 3,7 billion euros without any plant closures resulting from the transaction. According to the release, it is argued that 80% of the synergies would be achieved after 4 years.

-The total one-timecost of achieving the synergies is estimated at €2.8 billion, Fiat Chrysler and Peugeot say.

The new company would have Dutch parent company, with Dutch governing rules, and the Board would include a majority of independent Directors. John Elkann would be the Chairman of the Board and Carlos Tavares would be as CEO, but also a member of the board.

It is expected that the companies form the Memorandum of Understanding in the coming weeks.

– Both share the conviction that there is compelling logic for a bold and decisive move that would create an industry leader with the scale, capabilities and resources to capture successfully the opportunities and manage effectively the challenges of the new era in mobility, the companies underline the benefits of the merger.

The new car company would have annual revenues, combined of nearly 170 billion euros and operating profit over 11 billion euros.

 

 

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Fiat Chrysler and Peugeot PSA agree to merge – WSJ

The auto industry is having its golden years regarding changes. Now the Italian car manufacturer Fiat Chrysler (FCHA) is said to merge with the French Peugeot owner PSA (UG). The companies are expected to publish the details on Thursday the Wall Street Journal reported siting sources.

Peugeot-508-SW-HybridThis 46 billion dollars merge would create the world fourth largest car manufacturer. Last time when Fiat was in the headlines, it was about a merge with French Renault (RNO) in June 2019. Then the companies were also discussing about vehicle platforms and sharing engineering resources. According to media sources, this merge did not get the French government approval so the deal broke up.

This time the French government is also involved while the government is one of the biggest owners of Peugeot with 12 % ownership.

The new auto company would be the fourth largest in the world after Volkswagen, Toyota and Renault-Nissan. The industry is facing heavy technology changes due to electrification, emission reductions and autonomous driving. This has also caused that some manufacturers are calling for sharing tech platforms and R&D for electric car manufacturing.

The Milan listed Fiat stock closed up 9,5 % and the Paris based Peugeot also gained 4,5 % on Wednesday.

 

 

 

 

 

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Fiat withdrew from the merger deal with Renault

The Italian automaker Fiat Chrysler (FCA) withdrew from the merger deal with the French Renault (RNO). According to the company info, the merger proposal was rejected by the French government, which owns 15 % of Renault.

If the 35 billion euros merger would have continued, the companies would have created the world’s third largest car manufacturer. Shares of Nissan´s and Renault alliance partner Mitsubishi Motors fell in Tokyo today, while Fiat closed yesterday down 3,3 % to 12,75 dollars in New York. Renault traded yesterday down 0,65 % to 56,20 dollars in Paris.

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Auto stocks gained by the Fiat-Renault news (updated)

The auto stocks gained on Monday trading in Europe after the confirmation of the Italian-French car manufacturing merger proposal. Fiat Chrysler (FCA) and Renault (RNO) said that they are planning a 35 billion euros merger, which would make the new company the world’s third largest auto manufacturer. The planning of the merger was published on Saturday evening.

Fiat´s stock price jumped by 7,98 % to 12,37 euros and Renault´s 12,09 % to 56,03 euros. The Stoxx Europe 600 Automobiles & Parts index ended up 1,43 % to 473 points.

The idea of the auto merger is to get synergies, estimated of 5 billion euros, in the R&D related to electric cars and lower emissions, and in the purhasing power. The new company, owned by 50-50 % by a Dutch holding company, would have production of 8,7 million cars annually. Brands like Jeep, Maserati and Alfa Romeo would be part of the merger.

The Japan alliance partner Nissan Motor & Mitsubishi might join the new group later on. In order to proceed the Italian and French Governments will comment the merger in details during the next week.

Otherwise the German DAX-index gained 0,5 % to 12071 points and the French CAC 40 0,37 % to 5336 points. The shares of Volkswagen, the world´s largest car manufacturer, (VOW) ended up 0,55 % to 145,25 euros in Frankfurt.

In London the trading was closed due to the Spring Bank Holiday.

In the US, the stocks markets were closed while having Memorial Day holiday.

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Fiat Chrysler, Renault are in talks – WSJ

The European auto industry may be changing when the Fiat Chrysler (FCAU) and Renault (RNO) are in talks for a wide-ranging co-operation, writes the Wall Street Journal. According to the newspaper, if there is going to be an agreement, it would happen soon.

The auto makers have been discussing sharing vehicle platforms and engineering resources, the sources say. An option is also that Fiat will join a three-way alliance between Renault, Nissan Motor (7201) and Mitsubishi Motors

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