French carmaker PSA Peugeot Citroen (IW 1000/47) on Thursday said it is in negotiations to sell 75% of its logistics subsidiary Gefco to Russian railway firm RZD for 800 million euros ($1.04 billion).
While RZD would effectively get control of Gefco under the deal, the head office of Gefco's logistics group is expected to remain in France and the company is expected to retain its current management team, including Luc Nadal as president, Peugeot said.
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," the automaker added.
The divestment is part of a wider effort to liquidate assets, as the struggling French automaker is trying to raise 1.5 billion euros to improve its financial situation.
The group also has undertaken cost-cutting measures, including slashing 8,000 jobs in France and closing a factory near Paris, much to the consternation of its home country.
Gefco employs 9,400 people worldwide, including about half in France, and posted 3.78 billion euros in sales in 2011.
Copyright Agence France-Presse, 2012