Fiat Chrysler and PSA Group Shareholders Approve Merger

Fiat Chrysler and PSA Group shareholders vote to approve a merger of the two automakers.
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Fiat Chrysler Automobiles NV  (FCAU) - Get Report and PSA Group shareholders approved Monday the merger of the two companies to form Stellantis, the world’s fourth-largest automaker. 

Fiat Chrysler shares were up 1% to $18.27 in trading Monday.

The combined new company includes the brands Fiat, Jeep, Dodge, Ram and Maserati, Peugeot, Opel and DS. Fiat Chrysler sold 4.4 million cars in 2019-2020.

The companies agreed to the $50 billion all-share deal in December 2019. The brands will keep their badges and logos.

The deal received European Union regulatory approval just before Christmas.

PSA’s main shareholders backed the tie-up at a meeting with 99% support due to their double voting rights

“We are ready for this merger,” PSA CEO Carlos Tavares told PSA shareholders, Bloomberg reported, adding that the companies are also prepared to announce a date for completion of the deal.

Taveres "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," Bloomberg reported.

The companies are talking about consolidating vehicle platforms - the underpinnings and powertrains - to save billions in engineering and manufacturing costs, the Associated Press reported.

"You can’t be cost efficient if you keep the entire scale of both companies,” said Karl Brauer, executive analyst for the iSeeCarsauto.com website. “We’ve seen this show before, and we’re going to see it again where they economize these platforms across continents, across multiple markets.”

This could mean job losses in Italy, Germany and Michigan as PSA Peugeot technology is integrated into North American and Italian vehicles.

Stellantis’ common shares will begin trading on the Mercato Telematico Azionario in Milan and Euronext in Paris on Jan. 18 and on the New York Stock Exchange on Jan. 19.

Stellantis is derived from the Latin verb “stello”, which means “to brighten with stars,” the companies said.