MILAN - Fiat Chrysler Automobiles and PSA Peugeot are planning to announce a binding memorandum of understanding that will merge the two carmakers, a person briefed on the announcement said on Monday.
A prepared statement on the agreement will be released early on Wednesday in Europe, according to the person who requested anonymity due to a lack of authorisation to speak before the announcement.
The two companies announced a merger in October that would create the world’s fourth-largest car company, worth $50 billion (R720bn) and producing 8.7 million cars a year - just behind Toyota, Volkswagen and the Renault-Nissan alliance.
While the deal has been touted as a 50-50 merger, French carmaker PSA is expected to have the upper hand, with its cost-cutting CEO Carlos Tavares in charge and PSA controlling the new company’s board.
Fiat Chrysler chairman John Elkann, whose family founded Italian carmaker Fiat in 1899, is expected to remain chairman of the merged company. The role of Fiat Chrysler CEO Mike Manley remains unclear.