Fiat & PSA plan 50-50 merger to draw up world’s No. 4 automaker

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Fiat & PSA plan 50-50 merger to draw up world’s No. 4 automaker

London-based Italian-American carmaker Fiat Chrysler Automotive NV, shortly dubbed as FCA, alongside Peugeot maker French PSA, had been drawing out a plan to combine forces at a 50-50 merger, which in effect would be creating the world’s fourth-largest automaker, behind Japanese Toyota, United States’ GM and German Volkswagen, in a bid to grapple with growing expense of costly mergers amid waning auto demands across the globe.

More importantly, FCA and PSA issued a joint statement on Thursday, the 31st of October 2019 saying that the long-hailed automakers had been in an advanced-stage talk to seal a deal over the coming weeks to form a $50 billion 50-50 merger, which would have public listings in Paris, Milan, and New York stock exchange, while FCA’s John Elkann would act as the Chairman of the merger and PSA’s Carlos Tavares would be the Chief Executive Officer.

Meanwhile, following reveal of Thursday’s (October 31st) PSA-FCA joint statement, industry analysts were quoted saying that the likely merger would provide FCA with better access to PSA’s modern vehicle platform that would eventually help the Italian-American carmaker to avoid new emission rules over the Europe, while PSA would likely to benefit from FCA’s high-profit margin businesses in the United States with brands likes of Ram and Jeep.

Meanwhile, over optimism of a FCA-PSA 50-50 merger, Milan-listed Fiat shares wrapped up Thursday’s market 9.37 per cent higher to €14 a share, while Paris-listed shares of French PSA soared more than 10 per cent to round off Thursday’s (October 31st) market at €22.98 a share.