French car maker PSA Peugeot Citroen said on Thursday it was in negotiations to sell 75% of its logistics subsidiary Gefco to Russian railway firm RZD for €800 million ($1.04 billion).
While RZD would effectively get control of Gefco under the deal, the head office of the logistics group is expected to remain in France, Pugeot saidFurther, the company is also expected to retain its current management team, including Luc Nadal as president, Peugeot added.
The deal would help Gefco “further enhance its geographic expansion strategy in China, India and Latin America, but also accelerate its growth in Eastern and Central Europe, particularly in Russia,” stressed the car maker.
The divestment is part of a wider programme of assets sale, as the struggling French car maker is trying to raise €1.5 billion ($1.95 billion) to improve its financial situation.
The group has also undertaken cost-cutting measures, including slashing 8,000 jobs in France and closing a factory near Paris, causing consternation in its home country.
Gefco employs 9,400 people worldwide, including about half in France and posted €3.8 billion in sales for 2011.