Shares in Groupe PSA, parent company of automakers Peugeot, Citroën and the DS brand, rose on Thursday as analysts considered the possibility that Fiat Chrysler could turn back to PSA after withdrawing its $35 billion merger offer for Renault.

"Both parties have acknowledged the need for scale or [mergers and acquisitions] and may pursue other opportunities. If Nissan was an obstacle (to an FCA-Renault deal) PSA-FCA discussions could resume," wrote brokerage Jefferies.

Back in March at the Geneva Motor Show, rumors started swirling that PSA was interested in a potential merger with FCA. Mike Manley, who took over at the helm of Fiat Chrysler following the death of Sergio Marchionne, had indicated a willingness to look into potential partnership options. Of course, that was all before FCA proposed a merger with Renault — with that deal now off the table, attention naturally turns back to PSA, which is also based in France.

"We expect both shares to react negatively but see FCA having wider strategic options and Renault shares more downside risk near-term," said Jefferies.

According to Reuters, PSA shares were up 1.5% at the time this was published, making it the top-performing stock on France's benchmark CAC-40 Index. Renault saw its shares slump 7%. Shares for FCA fell 3% in early trading on the Milan Stock Exchange.

Considering that FCA said in its statement confirming the withdraw of its merger offer with Renault that "political conditions in France do not currently exist for such a combination to proceed successfully," we have to wonder how keen the company is to begin negotiations with another French automaker like PSA.

Those thoughts were similarly voiced by Bernstein Research analyst Max Warburton, who said (via Forbes), "Expect PSA to rise on unrealistic hopes it may be FCA's next date."


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