Fiat Chrysler and Groupe PSA (Peugeot, Citroen, Vauxhall, and Opel) have announced that the two automakers are joining forces, which will effectively create the fourth largest automaker. The 50/50 merger is still being finalized, but when the dust settles, the new group will be just behind VW, Toyota and the Renault-Nissan-Mitsubishi alliance with 8.7 million vehicles sold annually.

The merger is estimated to achieve €3.7 billion ($4.13 billion) estimated annual run-rate synergies without any plant closures. It is also projected that 80% of the synergies would be achieved after 4 years. The total one-time cost of achieving the synergies is estimated at €2.8 billion ($3.12 billion).

The shareholders of each company would own 50% of the equity of the newly combined group. The Board would be composed of 11 members. Five Board members would be nominated by FCA and five would be nominated by Groupe PSA. The Chief Executive Officer would be Carlos Tavares for an initial term of five years and he would also be a member of the Board.

“This convergence brings significant value to all the stakeholders and opens a bright future for the combined entity,” stated Carlos Tavares, CEO of PSA. “I’m pleased with the work already done with Mike and will be very happy to work with him to build a great company together.”

“I’m delighted by the opportunity to work with Carlos and his team on this potentially industry-changing combination, stated Mike Manley, CEO of FCA. “We have a long history of successful cooperation with Groupe PSA and I am convinced that together with our great people we can create a world class global mobility company.”