Merger Between FCA And PSA Will Reportedly Be Approved By European Authorities

The merger between FCA and PSA is inching closer to reality as officials in the European Union are set to approve the tie-up.

Citing people familiar with the matter, Reuters is reporting European authorities will sign off on the merger which will create the world’s fourth largest automaker.

While nothing is official, it appears the companies were able to smooth over antitrust concerns by promising to help Toyota which has a van joint venture with PSA. As part of the deal, PSA will reportedly ramp up production of Toyota vans and sell them at “close to cost price.”

Also Read: FCA And PSA Agree To Merge, Create The World’s Fourth Largest Automaker

Thanks to that and other small changes, the European Union could sign off on the merger by the end of the year. If that happens, it would come well in advance of a February 2nd deadline.

While an official announcement could some soon, FCA and PSA recently announced who will be sitting on the board of directors for the combined entity known as Stellantis. It would include Stellantis CEO Carlos Tavares, who currently runs PSA, as well as notable figures such as Andrea Agnelli, John Elkann and Robert Peugeot.

Before that, the companies amended their original “Combination Agreement” to cut a special dividend and thereby save €2.6 ($3.1 / £2.4) billion in cash. At the same time, the automakers suggested the merger could save them more than €5 ($5.9 / £4.5) billion annually.

Regardless of the financials, FCA and PSA have previously said they expect the merger to close by the end of the first quarter of 2021.