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:


Login or Create new account to add a comment!


We’ve seen quite a lot of intriguing stories in the age of Internet (where the most interesting part was revealed before the story unfolds). Some are from movies and novels...
by - October 26, 2016
Many people have long known that the new 2018 RS5 was being developed by Audi AG. Enthusiasts the world over were excited when a prototype was seen running on the...
by - October 26, 2016
It was only recently when BMW officially debuted the new 2017 5-Series Saloon (G30) online. At that time, this range revealed that it had driving dynamics that was the best...
by - October 26, 2016
Starting early 2017, the new Audi Q7 will be available with the new 2.0-liter TFSI four-cylinder engine that makes it not only faster but also lighter and more efficient than...
by - October 25, 2016
Soon, Fiat Chrysler’s Dodge brand will be ending the production of the Dodge Viper. So practically, the 2017 Dodge Viper will be the last Viper up for grabs. Gerry Wood...
by - October 25, 2016