China: Dongfeng confirms PSA talks image

After China’s Dongfeng Motor Group decided to halt its shares trading in Hong Kong, the company also confirmed the reports it was in talks with France’s PSA about the proposed share acquisition.

It seems that PSA’s deal with the French government and Dongfeng is one of the industry’s worst kept secrets, as we seem to bring you news about the proceedings even before the officials know about them.

Dongfeng triggered the share trading stoppage after it decided to make a yet unspecified announcement about unknown “inside information” – and of course gave no further detail. Now, they have confirmed the deal talks but added that the two groups are yet to reach any agreement.

It looks like this negotiation confirmation only comes as Reuters already reported last Friday that Peugeot and French government officials would come to China this week, in what they strived to be the final round of negotiations on the tie-up proposal with China’s second-biggest carmaker.

The planned share issue that would see PSA gain 3 billion euro ($4.1 billion) in cash has been a source of public discord among Peugeot family members and also triggered public protest from some of PSA’s minority shareholders.

Via Reuters