Fiat Chrysler Automobiles (FCA) and Peugeot have announced a 50-50 share merger that would create a company worth about $50 billion (KSh5 trillion). If approved, the deal will unite brands such as Fiat, Jeep, Dodge, Ram and Maserati with the likes of Peugeot, Opel and DS.
Among the merger’s obectives is to cut costs by $4.1 billion a year, without closing factories.
As reported by Reuters, the two companies expect to make about 40% of savings from product-related expenses, 40% from purchasing and 20% from other areas, such as marketing, IT and logistics.
According to the companies, the deal will close in the next 12 to 15 months. Thereafter, they will come up with a new name.
Additionally, China’s Dongfeng Motor Group has announced plans to trim its 12.2% stake in PSA by selling 30.7 million shares to the French firm. The sale will, therefore, translate to around 680 million euros. Thus, Dongfeng will have around 4.5% stake of the merged group.