By on June 19, 2013

We can’t help it that there is so much crummy news about GM, but here is something decidedly positive: GM  “has no plans to make additional investments in its French partner PSA Peugeot Citroen SA which is subject to the depressed European automobile market,” Dow Jones Newswire says via NASDAQ. The wire heard it from Dan Akerson himself, so it must be true.

A year ago, in an alliance of the walking wounded, GM bought 7 percent of  limping PSA. Since then, GM had to write down a good deal of that so-called investment.

PSA faces a European Union investigation triggered by the French government providing financial support for Peugeot’s financing arm.

The probe could derail a loan-guarantee package agreed to by France in October.

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8 Comments on “GM Good News: No More Investments Into PSA...”

  • avatar

    it was a reward for boycotting Iran anyway. the tribute is satisfied and we got out for cheaper than the Fiat Fiasco.

    • 0 avatar

      “we got out for cheaper than the Fiat Fiasco”. Huh? From what I can see, GM hasn’t “gotten out” of PSA. They bought shares, which they still own, but the cash is spent and the shares aren’t worth what GM paid for them.

      • 0 avatar

        I agree that it’s stupid, but not in the “We Just Flushed $2 Billion Down the Toilet” stupid that the Fiat deal was.

        • 0 avatar

          To be sure. Although, in cash terms, the Fiat deal looks to have been more than @ billion (the price GM paid to cancel Fiat’s put option.

          To backstop the initial share exchange, GM had to do a market reepurchase of $2.4 billion of its then-outstanding shares. I may be wrong, but that looks like a total cash drain of $4.4 billion. Which is to your point, I think.

  • avatar

    I’ve never understood GM’s lack of commitment to projects. Not that PSA was a good idea in the first place.

  • avatar

    It’s not about GM’s lack of commitment to projects. It’s about keeping the idiots supposedly in charge from making such stupid deals in the 1st place. How would you like to be the underling who tells Lt. Dan that investing in PSA is a bad idea?

    I’m sure more than a few GM lawyers and senior VPs privately screamed and ranted when they learned of the Fiat deal. But when the CEO walked down the hall, they probably all said, “Way to Go, Ricker!”

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