Fiat seeks merger with Renault to save billions
Fiat Chrysler Automobiles (FCA) has proposed a merger with Renault to save billions of dollars for both companies and make it the third largest car company in the world.
FCA said the merged company would be 50% owned by FCA shareholders and 50% by French manufacturer Renault shareholders. Renault's board is to meet in Paris to examine the possible merger. Shares in both companies jumped more than 10% on the news of the offer.
The companies have been in discussions for weeks, as major world car makers seek ways to save money amid the huge costs of pivoting the industry to electric and autonomous cars.
Renault is already in an alliance with Japan's Nissan and Mitsubishi, but the partnership has been troubled since the November arrest of joint chief Carlos Ghosn.
An official said the French government, which owns 15% of Renault, will only agree to a merger if it makes sense for jobs and France's national interests.
The official also said Japanese authorities have also been informed and France would prefer a tie-up within the existing Renault-Nissan-Mitsubishi alliance.
The statement said the merged company would produce 8.7 million vehicles annually and save €5bn (£4.4bn) for the companies each year.