Fiat Chrysler and Peugeot maker to a reach merger deal
Fiat Chrysler and Peugeot maker PSA have agreed to reach a binding agreement over a merger which costs roughly $50 billion that will transform the global car industry.
After announcing preliminary plans six weeks ago, Europe’s second and third biggest automakers will be ranked as the 4th largest automaker in the word after a 50-50 all-share tie-up. However, the companies are yet to finalize a name for their new company.
By reaching the said powerful agreement, the two behemoths in the industry, France’s PSA and Italian-American Fiat Chrysler Automobiles (FCA) will start working on how to reach a target of scrapping costs by 3.7 billion euros ($4.1 billion) each year without closing factories, as reported by CNBC.
Via a statement, the companies stated on Wednesday that they are looking forward to close the deal in the next 12 to 15 months and would come up with a name over the coming months.
“At this stage nothing is decided. We have been evaluating what the opportunities are,” PSA Chief Executive Carlos Tavares, who will head up the merged entity as CEO, informed the reporters.
PSA shares soared 4% in early trading, while FCA stock was added 1.7%.
(Image source: Aytac Unal | Anadolu Agency | Getty Images)