Published: Wed, July 04, 2018
Markets | By Otis Pena

Hyundai claims FCA buyout rumor is ‘totally groundless’

Hyundai claims FCA buyout rumor is ‘totally groundless’

Chennai: Changes are the forefront in the automotive sector with the EV boom taking the centre stage. Media reports indicate Mong-Koo is waiting for FCA's share prices to fall, as he plans to make a bid for the Italian-American auto giant.

Hyundai could be a good partner to FCA since it is now relatively weak in the Asian region, where Hyundai has a strong base. The report suggests that the bid will likely take place before FCA CEO Sergio Marchionne steps down in May 2019.

The closer political ties between the US and South Korea might make the merger more palatable for regulators in the countries. Officials from both sides, including Marchionne, publicly denied the reports. That would not be the case with a Hyundai-FCA merger, rumors of which first surfaced a year ago. Marchionne has previously stated he sees the future as merging with other automakers to reduce investment costs.

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That doesn't mean such a mega-merger wouldn't make financial sense, not least because the combined entity would immediately become the world's largest carmaker in terms of sales.

Yet despite the synergies that could develop via a Hyundai-FCA merger, Senior Group Manager of Hyundai Corporate and Marketing Public Relations, Michael Stewart tells us, "That rumor is totally groundless".

Although the statement pours a little cold water on the merger speculation, a tie-up could still happen. In 2015, it was reported that the FCA will come under the control of PSA, a month later, information appeared about a possible merger with GM, as well as the purchase of the Jeep brand from Great Wall Motor Company, Guangzhou Automobile Group and Dongfeng.

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