MOSCOW (Pakistan Point News / Sputnik - 21st December, 2020) The European Commission said on Monday that it had approved the merger between two large global car manufacturers, Fiat Chrysler Automobiles and PSA, provided they fully comply with the proposed commitments package.
The decision was made following the European Commission's in-depth investigation of the proposed merger, which was launched in mid-June. The transaction will lead to the creation of the fourth largest automotive group across the world, set to be called Stellantis.
"The European Commission has approved, under the EU Merger Regulation, the proposed merger between the automotive companies Fiat Chrysler Automobiles N.V. ('FCA') and Peugeot S.A. ('PSA'). The approval is conditional on full compliance with a commitments package offered by the companies," the EU body said in a press release.
The investigation took several months, as the commission had concerns that the proposed merger would harm the competition in the market for small light commercial vehicles in nine member states � Belgium, the Czech Republic, France, Greece, Italy, Lithuania, Poland, Portugal and Slovakia � where carmakers have rather high combined market shares and are particularly close competitors. As a result, the acquisition would have likely led to higher prices for customers.
To allay the bloc's concerns, the two companies offered a package of commitments aimed at enabling entry to and expansion of the market. In particular, among other things, Fiat and Peugeot committed to extending the cooperation agreement currently in force between Peugeot and Toyota for small light commercial vehicles so that Toyota can effectively compete with the merged entity in the future.
Fiat and Peugeot signed a binding merger agreement last December and aim at completing the deal in the first quarter of 2021. The merger plan has already been approved by 14 antitrust jurisdictions around the world, including the United States, China, Japan and Russia.
