The combined business would be 50% owned by Fiat shareholders and 50% by Renault stockholders.
The carmaker said the tie-up would create a global automotive leader, with 8.7 million vehicle sales.
Carmakers have faced pressure to consolidate amid major industry shifts, including towards electric vehicles.
In a statement, Fiat said the planned merger would create a “world leader in the rapidly changing automotive industry with a strong position in transforming technologies, including electrification and autonomous driving”.
No plant closures would be caused as a result of the tie-up, the carmaker said.
Fiat said that on a simple aggregated basis of 2018 results, the combined company’s annual revenues would be nearly €170bn (£149.6bn; $190.5bn) with operating profit of more than €10bn and net profit of more than €8bn.
Industry shifts toward electric models, along with stricter emissions standards and the development of new technologies for autonomous vehicles, have put increasing pressure on carmakers to consolidate.
Jamie Young
Jamie Young is Senior Reporter at Business Matters, covering SME finance, employment law and Westminster policy since 2016. He has reported on every Budget and Autumn Statement since 2018, helped make sense of the 'covid era' and the bounce-back loan scheme from launch through the fraud investigations, and broke the magazine's coverage of the 2024 late-payment reforms. He joined Business Matters straight from completing his BA in Administration from Exeter University and is NCTJ-qualified. Reach him at jyoung@cbmeg.co.uk
