World’s fourth-largest carmaker rallies on first day of trade after $52 billion merger

Flag with the Stellantis emblem on the entrance entrance to FCA’s Mirafiori plant on January 18, 2021 in Turin, Italy.

Stefano Guidi | Getty Images

LONDON — Stellantis, the product of the $52 billion merger between Fiat Chrysler Automobiles and Peugeot, was properly acquired by European traders on its first day of buying and selling Monday. 

Shares of the world’s fourth-largest carmaker by quantity, created after the merger was finalized on Saturday, climbed 7.5% by afternoon trade following its launch on inventory exchanges in Milan and Paris.  

The Milan-listed shares began buying and selling at 12.758 euros per share with a market cap of 39.2 billion euros ($47.3 billion), and by afternoon offers in Europe have been up at 13.55 euros per share. 

In a digital launch on the Borsa Italiana web site, Stellantis CEO Carlos Tavares, former CEO of PSA Group, stated the merger would add 25 billion euros in worth to shareholders over the approaching years resulting from projected price cuts. 

“All of our employees and our management teams are totally focused on the value creation that is embedded on the merger of FCA-PSA and the creation of Stellantis,” he added.

Chairman John Elkann stated the approaching decade would possible “redefine mobility as we know it.” 

“We have the scale, the resource, the diversity and the knowledge to successfully capture the opportunity of this new era in transportation,” he stated. 

“Our ambition is to build something unique, something great, by providing our customers with distinctive, safe, convenient, innovative and sustainable vehicles and mobility services.” 

The inventory will launch in New York when Wall Street opens on Tuesday, with U.S. markets closed Monday for a public vacation, after which Tavares will maintain his first press convention as Stellantis CEO. 

The launch marked the fruits of tie-up talks that started in late 2018, and comes because the auto business seeks to navigate a seismic shift in client demand towards electrical autos. 

Ahead of the deal, S&P Global Ratings upgraded FCA’s credit standing, predicting that Stellantis would profit from elevated scale and geographical range and a powerful capital construction. 

“The combined entity will have a solid balance sheet, good free cash flow prospects and large liquidity buffer,” S&P analysts Vittoria Ferraris and Margaux Pery stated in a notice. 

“In our base case, Stellantis’ net cash position will hover at about €14 billion on an unadjusted basis. This will provide the group with a considerable buffer to market conditions, which remain exposed to COVID-19-linked mobility restriction risks during the first half of 2021, and could suffer from the gradual reduction of government support.”

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