Flag with the Stellantis logo on the front entrance of 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 well received by European investors on the first day of trading on Monday.
The shares of the fourth largest carmaker in the world, created after the merger was completed on Saturday, climbed 7.5% against the afternoon trading after its launch on stock exchanges in Milan and Paris.
The shares listed in Milan started trading at 12.758 euros per share with a market capitalization of 39.2 billion euros ($ 47.3 billion), and by noon trading in Europe was at 13.55 euros per share. share rose.
In a virtual launch on the Borsa Italiana website, Carlos Tavares, CEO of Stellantis, former CEO of PSA Group, said the merger will add 25 billion euros in value to shareholders over the coming years as a result of the expected cost cuts.
“All of our employees and our management teams are completely focused on the value creation embedded in the merger of FCA-PSA and the creation of Stellantis,” he added.
Chairman John Elkann said the coming decade is likely to redefine mobility as we know it.
“We have the scope, the resource, the diversity and the knowledge to successfully seize the opportunity of this new era in transportation,” he said.
“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 stock starts in New York when Wall Street opens on Tuesday, with US markets closing for a public holiday on Monday, after which Tavares will hold its first press conference as CEO of Stellantis.
The launch was the culmination of talks that began in late 2018, and it comes as the auto industry tries to find a seismic shift in consumer demand for electric vehicles.
Prior to the agreement, S&P Global Ratings improved FCA’s credit rating and predicted that Stellantis would benefit from greater scale and geographical diversity and a strong capital structure.
“The joint venture will have a solid balance sheet, good free cash flow prospects and a large liquidity buffer,” S&P analysts Vittoria Ferraris and Margaux Pery said in a note.
“In our base case, Stellantis’ net cash position on an unadjusted basis will be around € 14 billion. This will provide the group with a significant buffer against market conditions, exposed to COVID-19 linked mobility constraint risks during the first half of 2021 , and can be gradually reduced by government support. ‘