Fiat Chrysler and PSA fine-tuned the merger agreement

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Car manufacturers Fiat Chrysler and PSA have modified the arrangements around their merger in order to better deal with the blows of the corona crisis. The two groups at the beginning of next year, would merge the fourth-largest automaker in the world, and to reduce, among others, the special dividend, the shareholders receive in the merger.

The Special profit distribution has been reduced to a total of EUR 2.9 billion, compared to the EUR 5.5 billion previously announced. With this adjustment, Fiat Chrysler and PSA, the owner of the Peugeot, Opel and Citroën brands, want to keep more money in cash. These buffers are needed because the worldwide outbreak of the coronavirus has resulted in large amounts of money being poured out by forced factory closures.

Contrary to previous agreements, the stake held by PSA in auto parts maker Faurecia is shared among all shareholders of the merger company as part of the deal. Initially, these shares would only go to PSA shareholders as a reward.

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Nicholas de Kramer

Nicholas de Krammer, а self-taught economic analytic with heave mathematical background. Math behind the economics (and economics behind math) is the strong side of the author. Contact him at [email protected]

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