The boards of Fiat Chrysler Automobiles and Peugeot are going to meet separately on Tuesday to talk about the finalization of an initial agreement for a $50 billion merger which would create the world’s number four automaker, sources stated.
A source close to FCA stated the two companies could declare the signing of a binding memorandum early on Wednesday, after a conference call to explain more details later in the day.
The two mid-sized automakers announced plans six weeks ago for a tie-up to help them facing with big challenges in the industry, including a global demand slump and the need to develop expensive cleaner cars to meet looming anti-pollution rules.
Ahead of the meetings, entities representing the Peugeot family, Etablissements Peugeot Freres (EPF) and FFP, unanimously authorized a proposed memorandum of understanding for the planned merger, a source familiar with the matter stated.
FCA and PSA have stated they would look forward to finalize a deal by year-end to form a group with 8.7 million in annual vehicle sales.
That would put it fourth worldwide behind Volkswagen, Toyota, and the Renault-Nissan alliance.
PSA’s Carlos Tavares will be CEO and FCA’s John Elkann.
The group will consist of the Fiat, Jeep, Dodge, Ram, Chrysler, Alfa Romeo, Maserati, Peugeot, DS, Opel, and Vauxhall brands, permitting it to serve mass and premium passenger auto markets along with those for trucks and light commercial vehicles.
