Peugeot Might Be Seeking Merger Advisor, Suggesting China Favourite.
General Motors tried to make clear that it has no intention of merging with Peugeot-Citroen, while newspaper reports said the French company is actively seeking a deal, suggesting that Dongfeng Motor of China might have the inside track.
Last month Reuters reported that the Peugeot family planned to give up control of the company, kick-starting rumours that GM was likely to be the favoured merger candidate, not least because the U.S. company has a seven per cent stake in the French one, and a cooperation programme for engines and new cars. If GM didn’t want a deal, Dongfeng Motor was said to be next in line.
“All I want to do is to get the programmes, the current programs, to work,” General Motors vice-chairman Steve Girsky said, adding that GM doesn’t plan to invest more in Peugeot-Citroen.
This would make a lot of sense, according to Garel Rhys, emeritus professor of Motor Industry Economics and director for Automotive Industry Research at Cardiff Business School.
“Two drowning men don’t make a swimmer,“ said
“I can’t see GM doing anything so stupid. They want to survive (in Europe) and they are doing quite well. I can’t see how linking relatively failed operations would make any sense. Why would GM want another set of problems. If you’ve got two in trouble you don’t just double the problem, but often get something far worse. If they did get together, it would take about a decade to do it. If they do decide to merge, all the other boardrooms (of mass car makers in Europe) would be opening up the champagne as Peugeot and Opel committed Hara-Kiri,” Rhys said.
Meanwhile French daily newspaper Le Figaro said Peugeot-Citroen was looking to recruit an investment bank, suggesting some kind of deal was imminent.