France to Hire Advisor to Monitor PSA

France's Finance Ministry confirms that it is seeking an outside advisor to monitor ailing carmaker PSA Peugeot Citroen because the government has guaranteed loans to the company's finance arm.

Le Figaro reported earlier that the ministry aims to hire an investment bank. It predicted that Bank of America Merrill Lynch is likely to win the job.

The Paris-based newspaper concluded that the move signals that PSA is nearing a deal for a closer alliance with General Motors Co. or Dongfeng Motor Corp. Dongfeng is PSA's Chinese joint venture partner.

GM Vice Chairman Steve Girsky reiterates to Bloomberg News that the U.S. company, which owns 7% of PSA, has no intention of investing further. He calls speculation about an expanded partnership a "distraction" from executing the alliance's existing goals: shared purchasing, logistics and vehicle development.