Dec. 18 (Bloomberg) -- PSA Peugeot Citroen appointed Louis Gallois, former head of planemaker Airbus’s owner, as France’s board representative at Europe’s second-biggest carmaker following the government’s move to help the company’s bank unit.
Gallois will take his seat on Peugeot’s supervisory board after ratification at the annual shareholders’ meeting on April 24, the Paris-based company said in a statement today.
The French state and Peugeot’s labor unions each won board representation at the manufacturer as part of an agreement on Oct. 24 for the government to guarantee as much as 7 billion euros ($9.2 billion) in new bonds sold by the carmaker’s Banque PSA Finance division.
Debt at Banque PSA has the lowest investment grade at Moody’s Investors Service, which said on Nov. 14 that it’s reviewing whether to cut the rating because of the bank’s ties to the car-manufacturing parent company. Peugeot’s debt was reduced to three levels below junk at Moody’s on Oct. 10.
Gallois, 68, ran Airbus parent European Aeronautic, Defence & Space Co. for almost six years until May 2012, starting as co-chief executive officer in mid-2006 and holding the post alone following a reorganization in August 2007. Gallois published a report last month on France’s business competitiveness that was commissioned by President Francois Hollande.
Peugeot is taking steps to shrink its French automotive workforce by 11,200 positions, or 17 percent, over the next two years. The automaker is closing a factory on the outskirts of Paris, selling assets and working on a vehicle and component alliance with Detroit-based General Motors Co. as Europe’s auto market shrinks this year to the lowest volume since 1995.
Peugeot said on Dec. 15 that it’s close to completing a deal with a pool of banks to refinance debt at Banque PSA. Talks with lenders are “on track” and should lead to an agreement by the Dec. 25 Christmas holiday, Carole Dupont-Pietri, Peugeot’s head of investor relations, said today by phone. She declined to provide details.
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