Public statements on the creation of Stellantis of Fiat Chrysler Automobiles and Groupe PSA in France call it a “merger of equals”.
Official financial filing documents call the Stellantis merger what it really is: a takeover of Fiat Chrysler, including the Jeep, RAM, Dodge, Maserati, Alfa Romeo, Lancia and Fiat brands, by PSA.
Analysts have long suspected that PSA, which controls Peugeot, Citroen, DS and Opel, would emerge as the stronger of the two Stellantis founders, even with FCA’s John Elkann as Stellantis chairman.
And according to the merger prospectus (which will be voted on at the end of January next year), they are absolutely right.
It will be the French who will gain the upper hand over the Italian-Americans.
“Based on the assessment of the indicators in accordance with IFRS 3 (International Financial Reporting Standards) and taking into account all relevant facts and circumstances, FCA and the management of PSA have determined that Peugeot SA is the acquirer for accounting purposes ”, specifies the prospectus.
FCA filed its prospectus last week in the Mercato Telematic Azionario and Paris presented its version on the Euronext stock exchange, while it has also been filed with the Securities and Exchange Commission in the United States.
And it’s telling that this “peer-to-peer merger” is very similar to the last major “peer-to-peer merger” in the auto industry, where Daimler and Chrysler created a $ 36 billion merger in 1998. .
History shows that Chrysler was the junior partner at that time and it looks very similar for the company today.
The DaimlerChrysler period was extremely damaging for Chrysler, in particular, and 80.1% of the U.S. company was sold to private equity firm Cerberus Capital Management for just $ 7.4 billion.
It needed a $ 4 billion bailout from the Obama administration to stay afloat and filed for bankruptcy in 2009. Fiat took over the company on the basis of providing cleaner combustion processes to all. levels and the two companies merged in 2014.
While it may just be accounting to stay within IFRS guidelines, the PSA Group buyout is also in line with what most analysts expect.
Of the 11 members of Stellantis’ board of directors, six (including CEO Carlos Tavares, who is locked out for five years), will be from the northern European Alps, and PSA is paying a premium ahead of the merger to equalize contributions to shareholders. from both companies.
There is an argument that FCA’s largest shareholder, Clan Agnelli’s Exor holding company, will own Stellantis’ largest stake at 14.4%.
To counter this, the Peugeot clan will hold 7.2%, while the Chinese carmaker Dongfeng will own 5.6 and the French government, 6.2%. And there is no doubt that they would all fall on the French side of the argument if the pressure were to come on.
Here’s more proof: When the holding company FCA in the Netherlands swallows PSA to create Stellantis, PSA shareholders will receive 1,742 FCA shares for each of their PSA shares.
That’s a huge prize for PSA, which has long struggled with its lack of North American footprint.
FCA operates in 40 countries and sells its cars and trucks in 130 countries. It covers volume, luxury, luxury and sports cars, as well as trucks of the RAM brand.