FCA withdraws Renault merger proposals

Fiat Chrysler has withdrawn a proposal for a merger with Renault. It said the political conditions are not suitable for such an arrangement.

Fiat Chrysler had proposed a ‘merger of equals’ with Renault last week which was welcomed by financial markets and given a conditional green light by the French government.

However, French finance minister Bruno Le Maire said support was on condition there were no plants closures as a result.

Fiat Chrysler said, ‘FCA remains firmly convinced of the compelling, transformational rationale of a proposal that has been widely appreciated since it was submitted, the structure and terms of which were carefully balanced to deliver substantial benefits to all parties. 

‘However it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully.’

The merger would have created a group worth more than €30bn, producing 8.7 million vehicles per year.