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Fiat & PSA/Peugeot-Citroen set to Merge

 
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Plex
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PostPosted: Sun Dec 14, 2008 6:44 am    Post subject: Fiat & PSA/Peugeot-Citroen set to Merge Reply with quote

Would become world's 4th largest automaker

Reports out of Italy have suggested that Fiat and PSA/Peugeot-Citroen are looking into the possibility of merging as a way to survive the current financial crisis. The news comes just days after Fiat's CEO, Sergio Marchionne, stated that the company would need to find another automotive partner to ensure the company's survival in light of the recent economic downturn.

The issue seems to have reached a high enough level that leaders in both France and Italy have held discussions on the matter. According to analysts a merger between the two companies would make sense, considering that both have extensive experience making small cars and the two have worked together since 1978 on joint projects such as the recent Peugeot Boxer, Citro�n Jumper and Fiat Ducato vans. If the two companies were to merge their combined output would rival Volkswagen and Renault-Nissan, making the proposed company the fourth largest automaker in the world.

Any potential merger would take months to complete, but if such as tie-up does occur hopefully we can expect the return of the Citroen SM.

Worldcarfans
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Plex
Zorce Jedi Master


Joined: 01 May 2005
Posts: 9039
Location: T&T

PostPosted: Mon Dec 15, 2008 8:19 pm    Post subject: Reply with quote

Fiat, Peugeot-Citroen considering merger

Perhaps we saw this one coming: Just a week ago, Fiat CEO Sergio Marchionne (pictured) told the media that he didn�t think Fiat could survive the market downturn without working directly with another manufacturer. Now comes a report that Fiat and PSA Peugeot-Citroen are considering merging with the help of French president Nicolas Sarkozy and Italian Prime Minister Silvio Berlusconi.

Italian business newspaper Milano Finanza reported over the weekend that Berlusconi�s office had spoken with Sarkozy�s office regarding a potential tie-up between the two manufacturers. Berlusconi�s office has been considering following the lead of France and Sweden by offering some financial aide to domestic automakers.

John Elkann, chairman of IFI, Fiat�s controlling shareholder, will meet with Berlusconi on Wednesday for an undisclosed purpose. The Italian paper suggested that the meeting could discuss a French-Italian merger.

The two automakers have had joint-ventures in the commercial vehicle and minivan segments, but both compete heavily in the small car market. Combined, Fiat, Peugeot and Citroen produced 6.2 million vehicles last year, about the same number as Volkswagen and Renault-Nissan. If the automakers joined forces, they would compete with Renault-Nissan for the title of fourth largest automaker.

Leftlanenews
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Plex
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PostPosted: Fri Jan 23, 2009 5:29 pm    Post subject: Reply with quote


Under the plan, Fiat would gain 35% of Chrysler in return for its vehicle platforms and technology, as well as distribution channels and management expertise

Peugeot may join Fiat-Chrysler alliance

Fiat Group, Chrysler and its parent company Cerberus Capital Management last week released a joint statement announcing they had signed a non-binding term sheet to establish a global strategic alliance. The alliance, to be a key element of Chrysler�s viability plan, would provide the American carmaker with access to competitive, fuel-efficient vehicle platforms, new powertrains, and components to be produced at Chrysler manufacturing sites. Now it appears PSA Peugoet Citroen may be joining the two as well, via a merger with Fiat.

The new deal between Fiat and Peugeot is far from certain, however. A Reuters report has Fiat searching Europe to secure a credit line of up to �5 billion ($6.4 billion) to finance a takeover of Peugeot. At the same time the Agnelli family, which owns about 30% of Fiat SpA, is financing an increase in its stake to the tune of �2 billion ($2.56 billion) in order to retain a controlling stake in the merged company. Neither Fiat nor Peugeot are commenting on the matter, however. Should the three carmakers - Fiat, Chrysler and Peugeot - partner, the conglomerate would become the third largest in the global industry, behind Toyota and GM.

While the Peugeot inclusion awaits further definition, however, the Fiat-Chrysler tie-up is well underway. Per that agreement, Fiat would provide distribution capabilities in key growth markets, as well as substantial cost saving opportunities and management expertise for Chrysler in addition to givign Chrysler access to its technology and components. The alliance would essentially allow both carmakers to take advantage of each other's distribution networks and production capabilities.

Importantly, the deal would not involve Fiat making a cash investment in Chrysler or committing to funding Chrysler in the future. Instead, in return for product and platform sharing, technology sharing, and access to additional markets, Fiat would receive an initial 35% equity interest in Chrysler.

Some of the proposed benefits for Chrysler include city and compact vehicles sourced from Fiat, fuel efficient and environmentally friendly powertrain technologies, and access to distribution channels for Chrysler vehicles in markets outside of North America.

At the same time, the deal would also provide Fiat with a much-needed platform for re-entry into the U.S. market. Cars like the tremendously successful Fiat 500 and any number of Alfa Romeos could find many happy homes among U.S. buyers increasingly concerned with emissions, fuel efficiency and vehicle cost. For Fiat, however, it's not a sensible business proposition to sell those cars in the U.S. unless they are built locally.

Motorauthority
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