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Fiat Chrysler shares get a boost after revised Stellantis merger deal with PSA

MILAN — Shares in Fiat Chrysler (FCA) rose sharply in Milan on Tuesday after the car maker and French partner PSA revised the terms of their merger deal, with FCA's shareholders getting a smaller cash payout but a stake in another business. FCA and PSA, which last year agreed to merge to give birth to Stellantis, the world's fourth largest car manufacturer, said late on Monday they had amended the accord to conserve cash and better face the COVID-19 challenge to the auto sector. Milan-listed shares in Fiat Chrysler rose almost 8% by 1000 GMT, while PSA gained 1.5%. Under the revised terms, FCA will cut from 5.5 billion euros ($6.5 billion) to 2.9 billion euros the cash portion of a special dividend its shareholders are set to receive on conclusion of the merger. However, PSA will for its part delay the planned spinoff of its 46% stake in car parts maker Faurecia until after the deal is finalized. That means all Stellantis shareholders — and not just the current PSA investors - will get shares in a company which has a market value of 5.8 billion euros. Based on Stellantis' 50-50 ownership structure, FCA and PSA respective shareholders will each receive a 23% stake in Faurecia. Analysts welcomed the 2.6 billion euros in additional liquidity for Stellantis' balance sheet as well as the increase in projected synergies to more than 5 billion euros from 3.7 billion. There was also further reassurance as the two companies confirmed they expected the deal to close by the end of the first quarter of 2021. "All told, the two players emerge as winners," broker ODDO BHF said in a note. "Of the two, FCA might be a bit more of a winner in the short term given the structure of the deal and the numerous payouts to shareholders to come in the quarters ahead (potentially close to 5 billion euros versus the current capitalization of around 16 billion euros)." The special dividend for FCA shareholders had proved contentious after Italy offered state guarantees for a 6.3 billion euro loan to the company's Italian business. "These announcements should, at last, end the debate over the financial terms of the merger, which had become a big topic and was still penalizing the two groups' share performances," ODDO BHF said. PSA and FCA said they would consider paying out 500 million euros to shareholders in each firm before closing or else a 1 billion euro payout to Stellantis shareholders afterwards, depending on market conditions and company performance and outlook.

BMW M5 and FCA's 5-year plan | Autoblog Podcast #544

On this week's Autoblog Podcast, Associate Editor Reese Counts is joined by Green Editor John Beltz Snyder and Consumer Editor Jeremy Korzeniewski. We talk about driving the Subaru Ascent and BMW M5, and discuss FCA's five-year plan and the Audi Q8. As always, we help spend a listener's cash on a new car in the "Spend My Money" segment. Autoblog Podcast #544 Your browser does not support the audio element. Get The Podcast iTunes – Subscribe to the Autoblog Podcast in iTunes RSS – Add the Autoblog Podcast feed to your RSS aggregator MP3 – Download the MP3 directly Rundown Cars we've been driving: 2019 Subaru Ascent and BMW M5 FCA's five-year plan Audi Q8 Spend my money Feedback Email – Podcast@Autoblog.com Review the show on iTunes Related Video: Podcasts Audi BMW Chrysler Dodge Subaru Car Buying Used Car Buying FCA subaru ascent

Chrysler launches new Ram ads and gears up for Super Bowl XLV [w/videos]

Perhaps no car company has made bigger splashes in the last two years at the Super Bowl than Chrysler, and the automaker's marketing chief, Olivier Francois, said today that he plans to be all over the big game again in February.
Last year, the company made an ad featuring Hollywood icon Clint Eastwood. The spot achieved viral status quickly when pundits charged that Eastwood's lines were politically motivated; meant to appeal to progressive voters/viewers favoring a second term for President Obama. In 2011, agency Wieden & Kennedy burst into the game with a now famous commercial featuring Eminem. Both ads have supported Chrysler's "Imported from Detroit" marketing platform.
Francois briefed reporters Monday at the Detroit Opera House while he also debuted a new series of ads for the Ram brand.