Two unnamed sources told Reuters the board of Peugeot family holding Establissements Peugeot Freres and a subsidiary have both approved “all of the proposals” from the Chinese company and the French state, which are both set to purchase 14-percent stakes in the struggling automaker.
Peugeot’s own board is expected to approve the deal this week and announce another agreement to establish a financing partnership with the Spanish bank Santander Group.
The rescue plan will establish Dongfeng, the French government and the Peugeot family as equal stakeholders. The Chinese company has demanded that the Peugeot family lose its double-voting rights, face limits to the amount of stock it can purchase, and bring on a new chairman with no ties to the family.
Most of the requirements are aimed at ensuring that the family will not retain or reestablish veto rights. It is unclear if all of Dongfeng’s demands have been carried into the final deal.
PSA Peugeot Citroen has faced slumping sales despite a general recovery in the automobile market. The company has received seven billion euros in state guarantees to back its financing division, however the terms are set to expire next year.
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