French car company PSA Peugeot Citroën has paid 2.2 billion euro to acquire German car brand Opel from its current owner, American General Motors. Thanks to the deal, PSA Peugeot Citroën will become Europe's second largest car manufacturer.
16 percent market share
It was a well-known fact that Peugeot and General Motors were talking, but several weeks of discussions have now led to a deal. Peugeot will pay 1.3 billion euro to acquire Opel and its British affiliate brand Vauxhall and another 900 million alongside BNP Paribas to acquire GM Financial's European activities.
The transaction should be finalized by the end of the year, both companies hope. Peugeot hopes to find 1.7 billion euro in synergies thanks to the Opel acquisition by 2026.
Despite major concerns in Germany and the United Kingdom, PSA Peugeot Citroën CEO, Carlos Tavares, said no jobs will be lost in the transaction.
The deal may even be good news for the struggling Opel brand, which has suffered an 8 billion euro loss since 2009. PSA's European market share also stands to gain from the deal, as it will now rise to 16 %. It will have surpassed Renault, but still trails Volkswagen. The move is also beneficial to GM, which wanted to get out of the European market for a while now after seeing it could not replicate its North American success here.