EU approval is looking likely

EU approval is looking likely

Peugeot-Citroen (PSA) and Fiat- Chrysler (FCA) are reportedly set to win EU approval for their merger and create 'Stellantis'.

Reuters reports that the European Commission is set to approve the merger after the two companies agreed to take measures that will allay competition concerns.

The report said that PSA has offered to strengthen Japanese rival Toyota, with which it has a van joint venture, by ramping up production and selling its vans at close to cost price. FCA and PSA will also allow their dealers in certain cities to repair rival brands, Reuters reported.

The formal EU decision could come by the end of the year, ahead of the official February 2 deadline, the report said.

Last month, the boards of Fiat-Chrysler (FCA) and Peugeot-Citroen (PSA) agreed to amend terms of their proposed merger in a move designed to further conserve cash in the light of the ongoing impacts of the COVID-19 pandemic.

The two also confirmed the timetable to create the new merged company (to be called Stellantis) by the end of the first quarter of 2021.

In a statement, they said annual estimated run-rate synergies in the new company are also increased to in excess of EUR5bn.