Report: PSA – Dongfeng talks are slow image

Peugeot’s negotiations on the 3 billion euro ($4.11 billion) French-backed tie-up with Dongfeng are slower than the what the troubled carmaker expected, according to sources that talked to the negotiators that came back from China.

The people, which are close to the proceedings, said the French company now wants to sign a non-binding outline deal with its local Chinese partner as far as late November, while the deal could then be signed early next year at the earliest.

A Peugeot spokesman said the company had nothing new to say on the matter except for what it already declared. It has though confirmed it wants a deeper partnership with its existing partner Dongfeng or even another carmaker.

Peugeot executives and people from France’s APE, the agency in charge of government holdings, formed a delegation that was involved in key talks with Dongfeng in Beijing on Saturday and Wednesday, the sources added. The negotiations were not as positive as expected as Dongfeng looks in no hurry to poor its money into Peugeot and is seeking a very good deal on the price, the people said.

Meanwhile, according to other sources, Peugeot is also mulling a May decision to sell off a stake in its Banque PSA car loans unit – as Europe’s biggest car financing player Santander is currently reviewing a bid to purchase 50% of Banque PSA, with an estimated net worth of around 3 billion euros.

Via Reuters