Fiat Chrysler Automobiles (FCA) and Groupe PSA have cleared another hurdle in the path leading to their merger under Stellantis, the world’s 4th largest global automotive OEM by volume.
The companies announced that a further step forward in this regard was taken on October 27 when their respective boards signed the cross-border merger terms that will apply to the combination.
FCA and PSA expect to complete the combination by the end of the first quarter 2021, subject to the customary conditions set forth in their “Combination Agreement”. The boards also agreed to allow Groupe PSA to sell up to approximately 7 per cent of auto parts supplier Faurecia’s outstanding share capital prior to the completion of the merger.
See Also: Meet Stellantis, The New Company Created By The Merger Of FCA And PSA
Consistent with the terms of the original Combination Agreement, the two parties also agreed to take such other steps (excluding additional disposals of shares) as may be necessary to ensure that Stellantis will not acquire control of Faurecia.
These decisions are expected to facilitate the securing of the necessary regulatory approvals in relation to the merger. FCA and PSA also decided that the cash proceeds from the disposal of Faurecia shares will be distributed to the Stellantis shareholders along with the distribution in kind of the remaining stake in Faurecia. PSA is currently the French auto parts supplier’s majority shareholder, with a stake of 46 percent.
As already announced on September 14, 2020, this will happen promptly after the completion of the merger and subject to approval by the Stellantis board and shareholders.
