PSA Group Closing In On Deal With General Motors

PSA Group Closing In On Deal With General Motors

PSA Group is edging ever closer to purchasing General Motors European Operations in a move which will see PSA become Europe’s second-largest automaker.

Bloomberg reports that the two companies will negotiate throughout the weekend to reach and announce a deal on Monday. As further evidence that the deal is progressing, a tentatively-scheduled meeting between European labor union officials and PSA management has been set for next week.

PSA’s chief executive Carlos Tavares is confident that he can create a restructuring plan to return Opel and Vauxhall to profitability and one that will allow Opel to serve as the company’s premium German alternative to its solely French brands.

Before a deal can be reached, a few key issues need to be resolved. For one, a negotiating point will revolve around how PSA can achieve 2 billion euros (£1.75 billion) in savings from the deal as well as how the pension plan for retirees (currently underfunded by $7.35 billion) will be managed.

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