Nissan And Renault Discussing Merger Into A Single New Company
30 March, 2018, 00:32
The French government also has a 15% stake in the company. The companies have been linked for almost two decades by a cross shareholding and by sharing Carlos Ghosn in key leadership positions, but the question of who will succeed Ghosn in a few year time has put the structure of the alliance on the front burner.
The two parties are talking about a deal where Nissan would essentially give shareholders of Renault stock in the new business, said the people.
At the moment, Renault owns 43 per cent of Nissan and Nissan owns 15 per cent of Renault.
A new deal would end an existing alliance between the two automakers and make them into one, said the sources, who requested anonymity due to the details not being made public.
A report that Renault and Nissan could extend their alliance to a full merger has powered shares in auto firms across Europe. Nissan shareholders would also receive shares in the new company in exchange for their holdings.
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It is forecast that the headquarters of the merged entity will be based in both the countries. In February this year, Carlos Ghosn, the chairman of Renault SA, announced that both the renowned automobile manufacturers will draft a plan to strengthen their alliance and make it irreversible.
Renault shares were up 5.4 percent in early session trading. Nissan shares had shed 0.5 percent to 1,094.50 yen in a market up 0.6 percent overall.
No decisions have been reached and talks, which have gone on for several months, might not result in any deal. The 64-year-old relinquished the chief executive officer role at Nissan last year to focus on the partnership. Mr Ghosn folded troubled carmaker Mitsubishi into the group in 2016. Volkswagen AG, the world's largest carmaker, sold 10.7 million vehicles previous year.