Fiat Chrysler, PSA merger to include investor loyalty scheme



© Reuters. FILE PHOTO: A Fiat Chrysler Automobiles sign at the U.S. headquarters in Auburn Hills, Michigan

By Agnieszka Flak and Nick Carey

MILAN/LONDON (Reuters) – Fiat Chrysler’s (MI:) (N:) merger with Peugeot maker PSA (PA:) will include a loyalty scheme to reward long-term investors and help prevent future takeover attempts, the prospectus for the planned tie-up shows.

Italian-American carmaker Fiat Chrysler (FCA) and France’s PSA agreed to combine in a $38 billion (28.6 billion pounds) all-share deal in December, uniting brands such as Fiat, Jeep, Dodge, Ram and Maserati with the likes of Peugeot, Opel, Citroen and DS.

Holders of shares in Stellantis – as the merged group will be known – for an uninterrupted period of at least three years may receive a special voting share in addition to each common share, the companies said in the prospectus.

Such a move could make management changes and takeover attempts of Stellantis more difficult, they added. The tax consequences of the loyalty scheme are uncertain, the companies said.

Stellantis will have a Dutch-domiciled parent company and its shares will be listed in Paris, Milan and New York.

Loyalty schemes are common for companies in the Netherlands and have already been used by Exor (MI:), the holding company of Italy’s Agnelli family and FCA’s controlling shareholder, not least during the spin-off of Ferrari (MI:), boosting Exor’s grip on the luxury sports car maker.

PSA CEO Carlos Tavares will run Stellantis and will receive a 1.7 million euro ($2.02 million) bonus upon completion of the merger.

FCA CEO Mike Manley will receive “a recognition award with a value equivalent to approximately five times his annual base salary” and a cash retention after the merger if certain conditions are met.

READ  Christmas brings little respite for struggling UK high street

The two companies said they have agreed to review the potential distribution of 1 billion euros to shareholders, either through a dividend evenly before the merger, or to be distributed afterwards by Stellantis.

PSA and FCA have filed the merger plan with antitrust authorities in 21 countries and the European Union. To date, they have obtained approval from 15 countries and a preliminary okay from Brazil which becomes final next week.

The EU is also expected to authorise the merger, sources have said.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





READ SOURCE

LEAVE A REPLY

Please enter your comment!
Please enter your name here