PSA and Fiat Chrysler merger finally gets shareholder approval

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After two years of drama the merger will form Stellantis, the world’s fourth-largest carmaker

Paris — PSA Group shareholders signed off on a combination with Fiat Chrysler Automobiles that’s endured two years of extraordinary drama, marked by on-again off-again talks, the transformation of their industry and a global pandemic.

“Stellantis will be a sort of conglomerate of brands, some great and some not so good and most very regional,” said Jefferies analyst Philippe Houchois. “The merger will be a good opportunity for a re-set.”The combined company will boast an impressive presence in North America’s lucrative truck and SUV segments, thanks to Fiat Chrysler’s Ram and Jeep divisions.

The job of shaking up Stellantis’s portfolio will fall to PSA CEO Carlos Tavares, an ultra-competitive amateur rally driver who calls himself a “performance psychopath”. He takes a Darwinian view on the industry, arguing that only the strong carmakers will survive the pivot to electric drivetrains and pursuit of autonomous driving.

Still, those qualms are outweighed by Fiat Chrysler shareholders being paid a pre-merger dividend of €2.9bn. The boards of both companies are also considering a potential distribution of €500m to each company before they close the deal, or €1bn afterwards to shareholders of the combined entity.

 

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