A few months after its abortive merger with Renault, the Italian-American car manufacturer Fiat Chrysler discusses a merger with the other major French group in the sector, PSA, said Tuesday a source close to the record. The two groups are discussing a merger of equals, which would create a business valued at some $ 50 billion. Other options are also on the table, added this source on condition of anonymity.
The chairman of the PSA board Carlos Tavares would become managing director of the new entity, whose board of directors would be chaired by Fiat Chrysler boss (FCA) John Elkann, heir to the Agnelli dynasty. Discussions are continuing between the two automobile groups but there is no guarantee that they will lead to an agreement, the source warned, confirming information from the Wall Street Journal . PSA sold 3.9 million vehicles last year, generating a turnover of 74 billion euros. FCA has sold 4.8 million vehicles, for 110 billion.
The world number 4
On the Paris Bourse, the French group has a capitalization of 22.54 billion euros, while the stock market valuation of FCA, listed on Wall Street and Milan, varies: it is a little over 28.1 billions of dollars in the United States and 20.74 billion euros in Milan. The union of the two groups would give birth to the world number 4 of the sector in number of vehicles sold (based on 2018 annual figures). It would point behind Volkswagen, the Renault-Nissan-Mitsubishi Alliance and Toyota, with the Alfa Romeo, Chrysler, Citroen, Dodge, DS, Jeep, Lancia, Maserati, Opel, Peugeot and Vauxhall brands.
The alliance would allow the French group to return through the big door to the US market, where FCA, via Jeep brands and Dodge RAM pickups, holds significant market shares in segments with the most lucrative margins.