PSA Denies Report It Plans Stock Sale

PSA Peugeot Citroen refutes a report in French newspaper La Tribune that it is considering the sale of new shares to raise cash for product development and other capital spending.

PSA denies that it faces a cash crunch and says a capital increase is not on the agenda. The company notes it had €7.3 billion in cash and €3.2 billion in untapped credit lines at the end of 2012.

PSA has said it aims to halve its cash outflow this year after burning through an average of €250,000 per month in 2012. To reach that goal, the company plans to close an assembly plant and R&D center in France.

PSA also began talks on Wednesday with its unions about new cost-cutting measures. Labor leaders say the company is seeking more than €100 million in concessions.