Peugeot considering merger with FCA

One of the PSA Group's largest shareholders, the Peugeot family, has announced it would back an acquisition of or merger with Fiat Chrysler Automobiles (FCA).

However, the French parent company of Peugeot, Citroen, DS and now Opel/Vauxhall might have to fight Hyundai for control of the Italian-American car-maker, following last year's report that the Korean giant will launch a takeover bid for FCA in May.

The public blessing of the famous Peugeot family for a merger is widely reported as the green-light PSA needs to pursue FCA following the success of its purchase of Vauxhall and Opel from General Motors.

Giving his backing for a deal in an interview with French newspaper Les Echos, Robert Peugeot -- when asked about a potential marriage with FCA -- remarked: "With them, as with others, the planets could be aligned."

“We supported the Opel project from the start,” the Peugeot family representative said, adding. “If another opportunity comes up, we will not be braking.”

If successful, the PSA Group -- Europe's second largest car-maker with 3.78 million vehicle sales in 2018 -- would add Alfa Romeo, Fiat, Maserati, RAM and the valuable Jeep brand, among others, to its growing portfolio.

The PSA Group's three major shareholders are the Peugeot family, the French government and China's Dongfeng Motor Group, each with 13.68 per cent.

Putting the cat among the pigeons, the PSA Group has also been reportedly considering snapping up struggling Jaguar Land Rover (JLR) from Tata, following its failed bid for Proton in 2017.

The motivation for multiple mergers or acquisitions comes off the back off the 2016 purchase of Opel from GM, which Robert Peugeot describes as an "exceptional success".

Enticing PSA Group boss, Carlos Tavares, to prioritise FCA over JLR is access to the North American market provided by US brands Jeep, RAM, Chrysler and Dodge.

The US is a huge market that regional brands like Peugeot have in the past failed to breakthrough in, but on the eve of Peugeot's re-launch there, FCA's dealer network could support the French brand by providing it with sales and servicing infrastructure.

Meantime, the boss of FCA -- whose former chief Sergio Marchionne had pursued a merger with GM -- Mike Manley told journalists at the recent Geneva motor show that he was "very open" to "partnerships, joint ventures or deeper levels of equity co-operation".