PARIS: French carmaker Peugeot Citroen said Wednesday it had selected Louis Gallois, former chief of the parent company of Airbus, as the head of its revamped board following its rescue by Chinese auto company Dongfeng and the French state.
At a meeting Tuesday the company's supervisory board approved a shake-up to include two representatives each from the French state and Dongfeng, who under a deal reached last month are to take part in a 3-billion-euro or $4.2 billion capital hike that will help the company survive after posting colossal losses.
A statement issued on Wednesday said the board formally approved signing the deal with state-owned Dongfeng and the French state, which is expected to take place next on March 26 at the presidential palace when Chinese President Xi Jiping visits Paris.
The French state and Dongfeng will each hold 14 percent stakes in the company after the capital increase, the same level as the Peugeot family which founded the carmaker.
Dongfeng is to be represented on the Peugeot board by its chairman Xu Ping and deputy general manager Liu Weidong, the statement said.
The French state will be represented by Bruno Bezard, general director of public finances.
As well as a representative of SOGEPA, the fund that manages the French state's investments in aeronautic firms.
The Peugeot family will have two seats on the board, which will also include six independent members, plus a represenative of employees and one of shareholders.
Shareholders are to be asked to approve the board appointments on April 25.
"After the annual shareholders' meeting, it will be moved that the Supervisory Board appoint Mr Gallois as Chairman," said a Peugeot statement.
Gallois, who headed up EADS, the parent company of planemaker Airbus which has since been renamed Airbus Group, was brought onto Peugeot's board in 2012 after the French state effectively rescued the company with 7 billion euros in loan guarantees for its car finance arm.
While not formally a representative of the state, Gallois is seen as having close ties to the French administration and was its choice to lead the revamped company's board.
Dongfeng had favoured outgoing Peugeot chief executive Philippe Varin taking over the supervisory board, but he declined.
The board also said the company would not issue a dividend for 2013, during which it racked up a loss of 2.3 billion euros.
The company suffered a loss of 5 billion euros in 2012. (AFP)