France is seeking an advisor bank to monitor PSA/Peugeot-Citroen, French daily Le Figaro said without disclosing its sources. According to the newspaper, the move by France shows that PSA is inching closer to finalizing a closer alliance with either General Motors Co. or Dongfeng Motor. The report said Bank of America-Merrill Lynch is one of groups considered as possible advisor banks.
Sources told Reuters in June that Peugeot, PSA's founding family, has offered to surrender its control of the carmaker as it strives to resurrect plans for a closer partnership with GM backed by a fresh investment from the US group.
France owns no stake at PSA but controls a 15-percent holding in local carmaker Renault. People privy with the discussions had said that any agreement merging PSA with Opel would encounter major political hurdles because it could result to further plants closures and job losses in France and Germany.
According to reports made earlier this month, Dongfeng, PSA's joint venture partner in China, has held discussions over acquiring a 30-percent stake in PSA. But the talks were inconclusive and would have taken too long, the sources said. The Peugeot family owns a 25.4-percent stake commanding 38.1 percent of voting rights in PSA.
PSA sought a government-led bailout for its Banque PSA financing arm after a series of credit downgrades hit borrowing costs. In exchange for an EUR18.5-billion package including up to EUR7 billion in state loan guarantees, PSA had agreed to the appointment of Louis Gallois as government-backed board representative. [source: Reuters]