FCA and PSA Group amend merger agreement

Fiat Chrysler Automobiles Company (“FCA”) (NYSE: FCAU/MTA: FCA) and Peugeot Motor Company (“PSA Group”) have agreed to modify certain terms of their binding 50/50 merger agreement to Create the world’s fourth largest Stellaantis Automotive Group.
FCA sets a special dividend of 2.9 billion euros (previously 5.5 billion euros) to its shareholders before the close, and PSA Group’s 46% of Faurecia’s shares will be distributed to the board of all Stellatis shareholders immediately after Stellatis’ approval And shareholders.
The respective shareholders of the FCA and PSA Group will receive 23% of Faurecia’s equal shares (with a capital injection of 5.867 billion euros at the close of the market on September 14, 2020), as well as a 50/50 stake in Stellattis. The group will now have a balance sheet Cash on board increased by 2.6 billion euros. In addition, the PSA Group and FCA’s board of directors will consider allocating 500 million euros to each company’s shareholders before the transaction is completed, or paying 1 billion euros after the transaction is completed.
FCA and PSA Group confirmed that the economic terms of the merger agreement signed on December 17, 2019 remain unchanged, and the proposed merger is expected to be completed by the end of the first quarter of 2021. At present, the estimated value of the annual operational synergies resulting from the creation of Stellattis has greatly increased from the initial estimate of 3.7 billion euros to more than 5 billion euros. The estimated total cost of one-time implementation of these synergies has also increased from 2.8 billion euros to 4 billion euros.