Fiat Chrysler, Peugeot shareholders OK merger
MILAN » Shareholders of Fiat Chrysler and PSA Peugeot voted Monday to merge and create the world’s fourth-largest auto company which, its architects hope, can more readily take on an enormous technological shift in the industry.
Addressing separate meetings, PSA Peugeot CEO Carlos Tavares and Fiat Chrysler Chairman John Elkann spoke of the “historic” importance of the merger, which combines car companies that helped write the industrial histories of the United States, France and Italy. Tavares will run the new company, while Elkann stays on as chairman.
Closing the deal
The only real hurdle left to closing the deal is listing shares of the new company, to be called Stellantis. The companies expect it to be finalized Jan. 16, with shares in the combined company trading on Jan. 18 in Milan and Paris and Jan. 19 on the New York Stock Exchange. Fiat Chrysler shares were up 0.2% in New York on Monday at $18.13, while Peugeot rose 1.7% to 22.75 euros.
Fiat Chrysler announced Monday that its stockholders as of Jan. 15 will get a special cash payment worth 1.84 euros ($2.26) per common share after the merger closes. The payments will cost 2.9 billion euros ($3.56 billion).
The new company will have the capacity to produce 8.7 million cars a year, behind Volkswagen, Toyota and Renault-Nissan, and create 5 billion euros in annual savings.
The marriage of the Italian-American and French rivals is built on the promise of cost savings in the capital- hungry industry during a technological shift to electrified powertrains and autonomous driving. But what remains to be seen is if it will be able to preserve jobs and heritage brands in a global market still suffering from the pandemic.
“Together we will be stronger than individually,” Tavares told a virtual gathering of shareholders. “The two companies are in good health. These two companies have strong positions in their markets.”
The new company will put together French massmarket carmakers Peugeot and Citroen, top- selling Jeep, and Italian luxury and sports brands Maserati and Alfa Romeo — pooling brands with histories spanning from 75 to over 120 years with strong emotional pull in their home markets.