Renault and Nissan reformulate their alliance

Renault owned 43.4% of Nissan. The two companies will close a new agreement under which Nissan and Renault Group will have a “15% cross-shareholding, with an obligation to retain it, and an obligation to cap their holdings,” they announced at a press conference in London.

Renault, Nissan and Mitsubishi, which entered the alliance in 2016, negotiated for months the details of this agreement, approved on Sunday by the board of directors of Renault, and on Monday morning by that of Nissan, the association said.

With this new balance the domination of the French group in the association ends, which began in 1999 when Renault acquired part of the capital of Nissan.

This business was complicated by the surprise entry of the French State into the capital of Renault in 2015 and by the spectacular fall of Carlos Ghosn, who chaired the alliance, and who ended up arrested in Japan at the end of 2018 accused of economic crimes.

Nissan CEO, makoto uchidastressed on Monday that this initiative is necessary to build a “culture of transparency and respect” between both manufacturers.

“We are going to be consistent, we are going to be focused on results and we will be generous and equitable, as we were during the negotiations,” said the manager.

For his part, the CEO of Renault, Luca de Meoaffirmed that “based on this agreement, there is a reactivation of the commercial and industrial initiatives initiated by this alliance”.

In any case, the French group is not going to immediately sell the rest of its shares in Nissan (28.4%) because its market value is much lower than the value currently registered in its accounts.

When the context is “commercially reasonable”, these shares may be resold for the benefit of Renault, the Alliance specified. Nissan will be able to make the first offer.

The two manufacturers will have equal voting rights on their respective boards of directors.

Renault will continue to receive dividends on those shares until they are sold, for which no specific deadline has been set.

Renault, Nissan and Mitsubishi collaborate on numerous vehicles and together they have a workforce of 375,000 employees.

Renault and Nissan cars have the same engines and there are Renault cars sold under the Mitsubishi badge.

With this new agreement, they also announced new industrial initiatives, especially in India and Latin America.

In Argentina, Nissan is going to launch a van designed by Renault and in Mexico the Japanese manufacturer wants to relaunch the French brand by producing its models.

Nissan and Renault also have a plan to launch in this market, where their growth margin is large, two common small electric vehicles.

In total, the three partners plan to invest 23,000 million euros in the electricity market in the next five years.

Source: Ambito