PSA completes 1 billion euro capital increase, solidifying GM alliance

Article by Christian A., on March 28, 2012

PSA/Peugeot-Citroen has successfully finalized the capital increase of 1 billion euro to strengthen its planned partnership with General Motors Co., the PSA disclosed. The increase in capital was announced in February. The stock sale was reserved for the current stakeholders. It was 78% oversubscribed according to PSA.

Chief Executive Philippe Varin stated that the sale will enable them to finance investments associated with projects at the "core of the strategic alliance" with GM. On March 6, it was announced that the issue price was 8.27 euros per share. This comprised a 42% discount on the closing price from the previous night.

Shares of PSA dropped by 1.3% to 12.63 euros on Tuesday, before the outcome of the issue was announced. Based on the partnership deal, which was disclosed on February 29, PSA and GM are aiming to achieve more than $2 billion in annual savings from shared logistics and purchasing as well as the joint production and development of automobiles and components.

GM is spending 304 million euros or $403 mln for a 7% share in the French company, making it the second largest stakeholder next to the Peugeot family. After the rights issue settlement on March 29, the Peugeot family will hold 37.9% percent of voting rights and 25.2% percent of PSA's capital, according to PSA.

If you liked the article, share on:

Topics: gm, psa, partnership

Comments

Recommended

It has been nearly eight years since Toyota entered a new era of sports cars when it officially unveiled the production version of the Toyota 86 – also known as...
by - February 27, 2019
The new Audi TT RS – yes, the top version of the German carmaker’s facelifted TT model series – is now officially here. If you could remember, the range-topping TT...
by - February 18, 2019
Nearly half a year ago when McLaren Automotive unveiled the McLaren 600LT Coupe, the British carmaker is now introducing a version that lets its passengers enjoy the thrill of an...
by - January 25, 2019
German carmaker Volkswagen is now making the latest evolution of the new Volkswagen Golf GTI -- the new Golf GTI TCR. First unveiled as a concept at the annual GTI...
by - January 24, 2019
It has been three and a half years since BMW unveiled the sixth generation of the BMW 7 Series. Thus, it is really about to give the 7 Series a...
by - January 17, 2019