PSA board approves binding agreement to merge with Fiat Chrysler-source

The board of French carmaker PSA, which owns Peugeot, approved a binding memorandum of understanding to merge with rival Fiat Chrysler, a source close to the matter said on Tuesday. A separate board of Fiat Chrysler (FCA) was underway to discuss finalizing an initial agreement for a $50 billion merger to create the world's number four carmaker, the source added.

PSA declined to comment. FCA was not immediately available for comment.