Peugeot family plans to boost its stake in the company formed by the proposed merger between Peugeot SA and Fiat Chrysler Automobiles NV immediately after completion, Reuters reported Jan. 12, citing an interview of a key member of the family by a French publication.
Jean-Philippe Peugeot, who heads family-run fund Etablissements Peugeot Freres SA, or EPF, said in an interview with L'Est Republicain that the family intends to immediately exercise the option to increase its stake in the combined company.
On Dec. 18, 2019, PSA and Fiat Chrysler agreed to a 50/50 merger to establish the world's fourth-largest automaker by volume and the third-largest by revenue.
Under the deal terms, the Peugeot family, which is set to own a 6.2% stake in the merged entity through EPF and FFP SA, would have the option to increase its shareholding by up to 2.5% by purchasing shares from Bpifrance SA and Dongfeng Motor Group Co. Ltd.
"There was a complex negotiation in order to obtain this possibility. It wasn't necessarily a foregone conclusion. Once the merger is complete, my family will give favorable signals," the executive reportedly said.
The executive reportedly also expects the French government, which is represented by Bpifrance, to eventually exit the new company. However, he does not expect Dongfeng Motor Group to exit the merged entity despite the Chinese automaker's willingness to reduce its stake in PSA.
PSA reportedly told Reuters that the executive's comments were "in line with what had been indicated" at the time of the deal announcement.