The deal will make Groupe PSA the second-biggest carmaker in Europe after Germany's Volkswagen.
French carmaker Groupe PSA on Monday announced the acquisition of General Motors' Opel and Vauxhall brands for €2.2 billion ($2.38 billion).
The move will make the owner of Peugeot and Citroen the second-biggest carmaker in Europe after Germany's Volkswagen.
Groupe PSA said it was also buying GM Europe's financial operations for €900 million, taking the total value of the deal to €2.2 billion.
The takeover includes six assembly plants and five component-making facilities, and some 40,000 employees.
The French giant's shares rose more than three percent, trading at €19.67 on the Paris stock exchange early Monday, after news of the deal broke.
Groupe PSA boss Carlos Tavares said the firm was "deeply committed to continuing to develop this great company and accelerating its turnaround."
Founded in 1862, Opel in recent years booked repeated losses, costing Detroit-based GM around $15 billion since 2000.
Opel operates some 10 factories spread across six European countries, and had 35,600 employees at the end of 2015, with 18,250 of them in Germany.
Vauxhall employs around 5,000 people in Britain.