Peugeot Citroe ̈ n officially announced that Dongfeng and the French government have taken a stake

　　Xinhuanet, Paris, February 19 (Reporter Li Ming) France’s largest automaker – PSA Peugeot Citroen Group officially announced a capital increase plan on the 19th, and the French government and China Dongfeng Motor Company will invest in equal shares as new shareholders to strengthen the group’s competitiveness.

　　According to the plan, PSA Peugeot Citroe ̈ n will implement a series of financial operations, increase capital by 3 billion euros (about 4.10 billion US dollars), and the French government and Dongfeng will each contribute 800 million euros (1.10 billion US dollars) to subscribe to 14% of PSA Peugeot Citroe ̈ n’s shares. The Peugeot family, the largest shareholder with 25.4% stake and 38.1% voting rights, will also pay for part of the stake, but its shareholding will be diluted to 14%. In addition, PSA and Dongfeng will also strengthen industrial cooperation, increase production capacity, and establish a common research and development center and a new joint venture factory.

　　Thierry Peugeot, PSA’s supervisory board chairperson, said the group’s supervisory board had unanimously agreed to the capital increase, which will open a new chapter in PSA’s history and help to strengthen the group’s financial position, promote future growth and benefit all parties.

　　PSA Peugeot Citroe ̈ n also said that the bilateral agreement related to the capital increase plan will be submitted to French and Chinese regulators for approval and is scheduled to be finally signed by the end of March this year.

　　Peugeot Citroen announced the same day that the group’s 2013 sales of 54.10 billion euros (74.40 billion dollars), down 2.4% from the previous year; net loss of 23.200 million euros (31.900 million dollars), narrowed 54% from the previous year.

　　Peugeot Citroe ̈ n was hit hard during the European debt crisis. In 2012, the loss reached a record high of 50.100 million euros (6.90 billion dollars), and the assets were severely reduced. In July of that year, Peugeot Citroe ̈ n announced a new restructuring plan, but the restructuring plan did not achieve the expected effect. Subsequently, Peugeot Citroe ̈ n launched capital increase talks with the French government and Dongfeng.

(Source: Xinhuanet)