PSA commences stock sale as part of 3 billion euros capital hike

Article by Christian Andrei, on April 30, 2014

PSA/Peugeot-Citroen has commenced its share issue program, offering its stock at EUR6.77 per share. The carmaker said in statement that investors have already committed to purchasing 36 percent of the stock available in the EUR1.95 billion ($2.7 billion) rights offer.

The rights offer is part of PSA’s EUR3 billion capital increase, which has already seen sale of stakes to Chinese partner Dongfeng Motor and the French states, which took on a price of EUR7.50 a share.

Erich Hauser, an automotive analyst at International Strategy & Investment Group, told Bloomberg that it was a lower subscription price than he would have thought, given the larger investors' commitment. Investors can apply to purchase seven new shares for every 12 shares already held, PSA said.

The subscription period will be from May 2 to 14, and the new stock will start trading on May 23. Dongfeng and the French state each bought around EUR1.05 billion of new stock and will purchase more in the rights offer, en route to acquiring a 14 percent stake each.

Once the rights offer is completed, the Peugeot founding family will no longer have control of the carmaker, as its stake would drop from 25.5 percent to just 14 percent PSA is partnering with Dongfeng as it expands outside Europe.

Newly installed PSA chief executive Carlos Tavares is working to cut costs and streamline product offerings to focus on more profitable vehicles.

PSA has been cutting production and jobs in order to plug its financial bleeding, particularly in the European vehicle market that has slumped for six consecutive years. It is deepening its partnership with Dongfeng to penetrate the largest auto market in the world, China.

Topics: psa

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Remember Zenos Cars, a British carmaker that specializes in designing and building lightweight and high-performance sports cars? If you are wondering how the company is faring with their E10 lightweight...
by - January 21, 2017
Mercedes-Benz has revealed that in 2017, its series 124 coupé will be celebrating its 30th anniversary. While this itself is a significant event, it will also mean that this model...
by - January 21, 2017
BMW’s 550i xDrive has long been considered as one of the most successful business sedans in the world. For the brand, this may not be enough as it has officially...
by - January 20, 2017
Amazon is now moving beyond the four corners of online retailing. Only recently, the retail giant has been awarded a patent for its Road Network system. Since the patented technology...
by - January 20, 2017
The newest version of the Lamborghini Huracan is not a Superleggera, but a Performante. When Lamborghini filed for a patent for a new name, there were still debates whether this...
by - January 20, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries