EU concerns on Fiat-PSA deal may require concessions
Commission concerned at dominance of small van sector by parties in €44bn merger
The European Union is concerned about the combined high market share in small vans of Fiat Chrysler and PSA, which are looking to merge. Photograph: Stephane Maher/Reuters
Fiat Chrysler and Peugeot / Citroën owner PSA may have to make concessions to secure approval of their $50 billion (€44.2 billion) merger, with European Union antitrust regulators concerned about their combined high market share in small vans, people familiar with the matter said.
The companies, which are seeking to create the world’s fourth-biggest carmaker, were told of the European Commission’s concerns last week.
If Fiat and PSA fail to dispel the European Commission’s doubts in the next two days and subsequently decline to offer concessions by Wednesday, the deadline for doing so, the deal could face a four-month long investigation.
The EU competition enforcer, which has set a June 17th deadline for its preliminary review, declined to comment. Fiat was not immediately available for comment while PSA had no immediate comment.
Hiving off overlapping businesses, usually a regulatory demand to ensure more competition, could prove tricky for the carmakers because of the technicalities.
Fiat and PSA are looking to merge to help offset slowing demand and shoulder the cost of making cleaner vehicles to meet tougher emissions regulations.