Peugeot family rules out taking GM stake

The family controlling PSA Peugeot Citroen has ruled out the prospect of taking a stake in US auto giant General Motors, the newfound partner of the French carmaker, because the two will remain rivals. Robert Peugeot, who heads the holding company which controls Peugeot, told Friday's edition of the Le Figaro daily that there was no prospect "today" of such a move, after a tie-up announced Wednesday whereby GM will take a seven percent stake in the French group. "It is also not envisaged that General Motors will get a seat on the management board because the two companies are going to remain competitors," Robert Peugeot told the newspaper. He said he had the feeling of being at a "historic moment. From a strategic point of view, the alliance with GM is as important as the tie-up with Citroen." It is also "firstly an industrial cooperation deal which allows us to think about durable growth for the group. The tie-up aims for two billion dollars in savings a year, shared equally between the two parties," he said. Separately, Thierry Peugeot, who heads the auto company's supervisory board, told Friday's Les Echos daily that the family did not want to reduce its stake to less than 33 percent, the minimum required for a blocking minority holding. Thierry Peugeot added that "GM cannot go above seven percent during the duration of the alliance, which lasts for 10 years." Currently, the Peugeot family holds some 45 percent of the voting rights in the company but this will fall to 40 percent after the deal which includes a share issue. PSA Peugeot Citroen and GM said Wednesday their global cooperation deal would slash costs for both and boost their competitiveness in Europe. The two said GM, the world's largest automaker, would take a 7.0 percent stake in Peugeot Citroen, Europe's number two after Volkswagen of Germany but officials stressed the limited aims of the deal. "This is an alliance, not a merger," GM chairman and chief executive Dan Akerson said in a conference call. Peugeot managing board chairman Philip Varin noted that the French automaker "remains independent, very clearly, on its strategic plan and its capital." French Industry Minister Eric Besson welcomed the deal as "good news" for jobs, saying he had been assured by Peugeot "that this partnership will be favourable to PSA's employment and presence in France."