According to Les Echos, the French government is analyzing the prospects of selling its stake in PSA Peugeot Citroën.
The reveal made by the French business daily points out the country’s shareholdings agency is currently reviewing all of the investments to see if it can sell some them. With the money earned, the French government wants to fund cash injections for the state-owned power giant EDF as well as for the nuclear group Areva which is having some major financial issues.
Les Echos cites an unnamed government official who said the investment in PSA is a prime candidate for sale, either the entire 14-percent stake or part of it. He explains there are two reasons why the PSA holding is being considered, because it was bought recently and also due to the reason that it’s showing a strong gain. As a matter of fact, the value of the French government’s stake in PSA has almost doubled in a little over two years since it was acquired for €800 million (about $891M).
However, the French government has not made up its mind yet and there’s also the matter of the 14-percent stake owned by China's Dongfeng Motor Group. PSA took the 14-percent stake in PSA back in 2014 as a way to help the cash-strapped group and also to balance the 14-stake owned by Dongfeng.
As you would expect, both PSA and France’s finance ministry refused to talk about the report.
PSA is in a far better shape than it was in the 2012-2014 period during which it lost more than €8 billion. Thanks to the company’s successful “Back in the Race” plan, PSA finished 2015 with a respectable profit of €1.2 billion, so the financial problems should be pretty much over by now.