Electric dreams

3 December 2009 By Alexander Smith

The French carmaker, a small global player, is talking about closer ties with struggling Mitsubishi. It doesn’t sound like a worldbeating combination, but the Japanese company’s electric technology is a lure and Peugeot needs to get global economies of scale somewhere.

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French carmaker PSA Peugeot Citroen could buy a 3050 percent stake in Japanese peer Mitsubishi Motors Corp, the Nikkei newspaper reported. It could pay up to 300 billion yen ($3.4 billion). Nikkei reported that top management at Mitsubishi were ready to accept a majority acquisition of the company by Peugeot if conditions were right.

Both companies confirmed they were in talks to strengthen their existing relationship, which would create a leader in electric vehicles, with Mitsubishi saying a capital tieup was possible.

Mitsubishi Motors shares closed 13.4 percent higher on Thursday. PSA Peugeot shares were up 1.0 percent in early trading on Thursday.

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