- Both companies will own 50% each
- The merger creates the fourth largest automobile group worldwide
PSA Groupe and FCA have announced a merger under which both companies will own 50% of the new company. Both boards have given the mandate to their respective teams to finalize the discussions to reach a binding Memorandum of Understanding in the coming weeks. The plan to combine the Groupe PSA and FCA businesses follows intensive discussions between the senior managements of the two companies. The proposed combination would create the fourth largest global OEM.
The transaction would be affected by way of a merger under a Dutch parent company and the governance structure of the new company would be balanced between the contributing shareholders, with the majority of the directors being independent. The board would be composed of 11 members. Five board members would be nominated by FCA (including John Elkann as Chairman) and five would be nominated by Groupe PSA (including the Senior Independent Director and the Vice Chairman). The CEO would be Carlos Tavares for an initial term of five years, who would also be a member of the board.
Speaking on the occasion, Carlos Tavares, said, “This convergence brings significant value to all the stakeholders and opens a bright future for the combined entity. I’m pleased with the work already done with Mike and will be very happy to work with him to build a great company together.”
