GM will buy 7% of PSA Peugeot Citroen, becoming the company's second-largest shareholder and strengthening its position in Europe at a time the valuation of European assets is low.
As part of the deal, Peugeot will raise about $1.3 billion through a rights offering, underwritten by a bank syndicate and an investment from the Peugeot family.
"This partnership brings tremendous opportunity for our two companies," said GM CEO Dan Akerson, in a statement. "The alliance synergies, in addition to our independent plans, position GM for long-term sustainable profitability in Europe."Alliance synergies would include shared vehicle platforms as well as a joint venture combining about $125 billion in annual purchases of commodities, components, other goods and services. Synergies are expected to produce annual savings of $2 billion annually within five years, with little benefit in the first two years. Initially, GM and PSA Peugeot CitroŽn would focus on small and midsized passenger vehicles, with the first vehicle on a common platform expected to launch by 2016. -- Written by Ted Reed in Charlotte, N.C. >To contact the writer of this article, click here: Ted Reed >To follow the writer on Twitter, go to http://twitter.com/tedreednc. >To submit a news tip, send an email to: email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV