Japanese carmaker Nissan has come to an understanding with Renault, where the French carmaker agreeing to reduce its stake from 43 percent to 15 percent in Nissan. The move is part of the focus of the alliance group to reduce long-term friction between the partners.
It was in 1999 that Renault had acquired 36.8 percent of Nissan’s outstanding stock for around $3.5 billion (Rs , while the Japanese carmaker had agreed to buy stake in Renault when it was financially able. In 2001, the Japanese carmaker bought 15 percent stake in Renault, which in turn increased Renault’s stake in Nissan to 43.4 percent.
In a statement issued today, Nissan says the ambition is to strengthen the ties of the alliance and maximise value creation for all stakeholders with a three-stage approach:
Reloading the partnership with high-value-creation operational projects. This will consist of key projects in Latin America, India and Europe, which would be deployed along 3 dimensions: markets, vehicles and technologies.
Nissan will also invest in Ampere, the EV and software pure player founded by Renault Group and aim to become a strategic shareholder.
Nissan and Renault Group would retain a 15 percent cross-shareholding, with a lock-up obligation, as well as a standstill obligation. They would both be able to freely exercise the voting rights attached to their 15 percent direct shareholding, with a 15 percent cap.
As part of the move Renault Group will transfer 28.4 percent of Nissan shares into a French trust, where the voting rights would be ‘neutralised’ for most of the decisions, but the economic rights (dividends and shares’ sale proceeds) would still entirely benefit to Renault until such shares are sold.
The French OEM will instruct the trustee to sell the entrusted Nissan shares if commercially reasonable for Renault Group in a coordinated and orderly process, but it would have no obligation to sell the shares within a specific pre-determined period of time. This is due to the fact that the current share prices of Nissan is lower than what Renault has accounted for in its books.
The company statement further states that the agreements are being finalised and the transaction remains subject to the approval of the boards of directors of Renault and Nissan.