PARIS Feb 16 The Peugeot family, the largest
shareholder in PSA Peugeot Citroen, will meet on
Monday to decide whether to give its blessing to two deals aimed
at securing the French carmaker's future, a source close to the
The family's consent is needed so PSA can announce,
alongside 2013 results on Wednesday, a memorandum of
understanding (MoU) on a recapitalisation deal under which the
French state and Chinese partner Dongfeng will both
take direct stakes in the group.
Peugeot is also expected to announce a separate European car
loans alliance with Spain's Banco Santander.
Both projects will be on the table of board meetings of the
Peugeot family holdings FFP and Etablissements Peugeot Freres on
Monday, a source close to the family said.
"They will decide their position on both the MoU and the
Santander project," the source said.
Peugeot, battered by a prolonged slump in demand for cars in
Europe and sustained by 7 billion euros of state guarantees, has
been in talks with Dongfeng for months over a rescue plan that
would see the Chinese automaker and French government take
Sources familiar with the matter told Reuters after a new
round of talks in China this week that PSA reached an outline
deal with Dongfeng and the French state to raise up to 4 billion
euros ($5.5 billion) in fresh capital and deepen cooperation
with the Chinese carmaker.
The Peugeot clan, which has controlled the company since the
early days of the automobile in the 19th century, currently has
a 25 percent stake commanding 38 percent of voting rights.
The deal approved in principle by the board would make its
holdings fall to 14 percent, a level equal to those of the
French government and Dongfeng, sources said.
A key unknown at this stage is the position of Thierry
Peugeot, currently head of the group's supervisory board and a
fervent advocate of maintaining the group's independence.
In parallel, Peugeot is close to reaching an agreement with
Banco Santander on a European car loans alliance aimed at
eventually replacing the French state guarantees that are
keeping the carmaker afloat, sources also told Reuters last
Under the agreement, Madrid-based Santander would enter
50-50 joint ventures with Banque PSA Finance in European markets
and pay cash to acquire a portfolio of loans from the carmaker's
financing arm, the sources said.
The planned share sale to Dongfeng and the French government
may be the French automaker's last survival hope after the
failure of earlier deal talks with U.S.-based General Motors
The accompanying industrial plan would see Peugeot and
Dongfeng retain and expand their existing joint venture,
increasing research and development cooperation with a view to
expanding into South East Asian markets, according to the
The final deal will be subject to approval by a shareholder
meeting later in the year.