US-Italian auto giant Fiat Chrysler and France's Groupe PSA, the maker of Peugeot and Citroen cars, announced Wednesday they are in merger talks that could create the world's number four automaker.
Fiat Chrysler Automobiles (FCA) said in a statement it "confirms there are ongoing discussions aimed at creating one of the world's leading mobility groups" with PSA.
The statement and a similar one from PSA offered no additional details. A person with knowledge of the matter told AFP on Tuesday that the merger would yield an entity valued at about $50 billion.
The person said Carlos Tavares, the chief executive of Peugeot's parent, Groupe PSA, would lead the new company as CEO while John Elkann, chairman of FCA, would be chairman.
Discussions between the automakers are ongoing and there is no guarantee of an agreement, the source said, confirming details first published in the Wall Street Journal.
According to Bloomberg News, FCA's board of directors is expected to hold an emergency meeting on Wednesday.
A merger of the two groups would bring under one roof Alfa Romeo, Chrysler, Citroen, Dodge, DS, Jeep, Lancia, Maserati, Opel, Peugeot and Vauxhall.