PARIS--PSA Peugeot-Citroen SA (PEUGY, UG.FR) will lose its slot
on France's CAC 40 stock index later this month, trans-Atlantic
stock-market operator NYSE Euronext (NYX) said Thursday, a
humiliating blow for the storied French auto maker.
In its place, NYSE Euronext will add Belgian chemical maker
Solvay SA (SVYZY, SOLB.BT) to France's benchmark blue chip index,
the stock exchange company said in a statement following its
quarterly review meeting. As part of the move, the troubled auto
maker will be relegated to a more minor index, dubbed the CAC Next
20 index. Meanwhile, Solvay will be removed from that list as it
moves up to the CAC 40, NYSE Euronext added.
A Peugeot spokesman declined to comment on the index change,
which will be effective beginning Sept. 24.
Peugeot's relegation is the latest ignominy for the car maker,
which has been battered by the downturn in automobile sales in
France and southern Europe, where its sales are concentrated. It
has also suffered from strategic missteps that led it to miss the
upswing in luxury cars, and lag its competitors in expanding
globally. Peugeot's stock is down 77% since July 2011.
Peugeot, which has been part of the CAC 40 since the index was
created in 1987, had earlier suggested that it may be "premature"
to kick it out of the CAC 40 while it is still working on its
turnaround effort. In July, the company announced plans to slash
8,000 jobs in France and save EUR1.5 billion ($1.9 billion) a year
in costs by 2015.
But that plan, which involves ending car production at a massive
plant north of Paris, also fueled a sharp rebuke from France's
government, potentially costing it political capital that could
have helped keep it on the list.
The committee in charge of the CAC 40 says that it takes the
size of a company's free float, its trading volumes and its market
capitalization into consideration when making changes to the index
but also considers nondata factors.
Peugeot had a market capitalization of EUR2.04 billion as of the
market close on Thursday. That's just barely over half of the
next-largest company on the index, French chip maker
STMicroelectronics NV (STM, STM.FR).
Escaping the ax Thursday was Alcatel-Lucent (ALU, ALU.FR), which
has the smallest market capitalization on the CAC 40, at EUR2.01
billion, but is one of the more heavily traded companies on the
index.
Write to Sam Schechner at sam.schechner@wsj.com
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