By Agnieszka Flak and Nick Carey
MILAN / LONDON (Reuters) – Fiat Chryslers (MI:FCHA) (N:FCAU) Merging with Peugeot Manufacturer PSA (PA:PEUP) will include a loyalty program to reward long-term investors and prevent future takeover attempts, as the prospectus for the proposed mergers shows.
Italian-American automaker Fiat Chrysler (FCA) and French PSA have agreed to close an all-share deal worth $ 38 billion in December, bringing together brands such as Fiat, Jeep, Dodge, Ram and Maserati with Peugeot . Opel, Citroen and DS.
Holders of Stellantis shares – as the merged group will be known – can receive a special voting share in addition to each common share for an uninterrupted period of at least three years, according to the companies named in the prospectus.
Such a move could make management changes and takeover attempts at Stellantis difficult, they added. The tax consequences of the loyalty program are uncertain, the companies said.
Stellantis will have a Dutch parent company and its shares will be listed in Paris, Milan and New York.
Loyalty programs are common in the Netherlands and have already been introduced by Exor (MI:EXOR), the holding company of the Italian Agnelli family and majority shareholder of FCA, not least during the spin-off from Ferrari (MI:RUN), which strengthens Exor’s grip on the luxury sports car manufacturer.
PSA CEO Carlos Tavares will lead Stellantis and will receive a bonus of 1.7 million euros ($ 2.02 million US) upon completion of the merger.
Mike Manley, CEO of FCA, will receive “a recognition award of a value equal to approximately five times his annual base salary” and a post-merger cash withholding if certain conditions are met.
The two companies have agreed to review the potential € 1 billion payout to shareholders, either through a dividend evenly before the merger or afterwards through Stellantis.
PSA and FCA have submitted the merger plan to the antitrust authorities in 21 countries and the European Union. So far, they have received approval from 15 countries and a preliminary okay from Brazil, which will be final next week.
The EU is also expected to approve the merger.