Fiat Chrysler Automobiles NV and Peugeot maker PSA Group are aiming to sign a formal agreement next week to combine and form the world’s fourth-biggest auto manufacturer, people familiar with the matter said.
Progress is being made on the memorandum of understanding even though some outstanding issues still have to be resolved, said the people, who asked not to be named because the information is not public.
Ways to assess potential Fiat liabilities that have come to light since a broad outline of the accord was unveiled on Oct. 31 are still under discussion, they said, adding that more than 100 managers are participating.
PSA has planned a Tuesday board meeting to consider the deal, one person said.
Representatives for Fiat and PSA declined to comment.
The companies had said they aimed to sign an accord before the end of the year.
Following the unveiling of the merger plan, rival General Motors Co (GM) hit Fiat with a blockbuster racketeering lawsuit alleging a bribery and corruption scheme.
Fiat has called the accusations meritless.
JPMorgan analysts have estimated GM is likely to seek at least US$6 billion in damages, with the extreme scenario being as much as US$15 billion.
In a separate development, Italian tax authorities claimed Fiat underestimated the value of its US business by 5.1 billion euros (US$5.7 billion) following its phased acquisition several years ago.
Fiat has said it strongly disagrees with the finding, which could potentially lead to a levy of as much US$1.5 billion.
A merger of Fiat Chrysler and PSA, the second-largest vehicle seller in Europe, would create a regional powerhouse to challenge Volkswagen AG.
Under the plan, the new company based in the Netherlands would be headed by PSA chief executive officer Carlos Tavares, while Fiat Chrysler chairman John Elkann would keep his role as chairman.
The combination would leave Tavares, who turned around PSA and the lossmaking Opel brand acquired from GM, to figure out how to improve Fiat’s struggling operations in Europe.
Fiat’s deep Italian roots, along with the French government’s 12 percent stake in PSA, might make any plans to slim down the new entity more difficult.
Three experts in the high technology industry have said that US President Donald Trump’s pledge to impose higher tariffs on Taiwanese semiconductors is part of an effort to force Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to the negotiating table. In a speech to Republicans on Jan. 27, Trump said he intends to impose tariffs on Taiwan to bring chip production to the US. “The incentive is going to be they’re not going to want to pay a 25, 50 or even a 100 percent tax,” he said. Darson Chiu (邱達生), an economics professor at Taichung-based Tunghai University and director-general of
‘LEGACY CHIPS’: Chinese companies have dramatically increased mature chip production capacity, but the West’s drive for secure supply chains offers a lifeline for Taiwan When Powerchip Technology Corp (力晶科技) entered a deal with the eastern Chinese city of Hefei in 2015 to set up a new chip foundry, it hoped the move would help provide better access to the promising Chinese market. However, nine years later, that Chinese foundry, Nexchip Semiconductor Corp (合晶集成), has become one of its biggest rivals in the legacy chip space, leveraging steep discounts after Beijing’s localization call forced Powerchip to give up the once-lucrative business making integrated circuits for Chinese flat panels. Nexchip is among Chinese foundries quickly winning market share in the crucial US$56.3 billion industry of so-called legacy
Hon Hai Precision Industry Co (鴻海精密) is reportedly making another pass at Nissan Motor Co, as the Japanese automaker's tie-up with Honda Motor Co falls apart. Nissan shares rose as much as 6 percent after Taiwan’s Central News Agency reported that Hon Hai chairman Young Liu (劉揚偉) instructed former Nissan executive Jun Seki to connect with French carmaker Renault SA, which holds about 36 percent of Nissan’s stock. Hon Hai, the Taiwanese iPhone-maker also known as Foxconn Technology Group (富士康科技集團), was exploring an investment or buyout of Nissan last year, but backed off in December after the Japanese carmaker penned a deal
WASHINGTON POLICY: Tariffs of 10 percent or more and other new costs are tipped to hit shipments of small parcels, cutting export growth by 1.3 percentage points The decision by US President Donald Trump to ban Chinese companies from using a US tariff loophole would hit tens of billions of dollars of trade and reduce China’s economic growth this year, according to new estimates by economists at Nomura Holdings Inc. According to Nomura’s estimates, last year companies such as Shein (希音) and PDD Holdings Inc’s (拼多多控股) Temu shipped US$46 billion of small parcels to the US to take advantage of the rule that allows items with a declared value under US$800 to enter the US tariff-free. Tariffs of 10 percent or more and other new costs would slash such
RSS