Renault slashes Nissan stake as the automakers overhaul their decades-long alliance
Renault and Nissan automobile logos are pictured during the Brussels Motor Show on January 9, 2020 in Brussels. (Photo by KENZO TRIBOUILLARD/AFP via Getty Images)
Kenzo Tribouillard | Afp | Getty Images
Automobile giants Renault and Nissan on Monday agreed to restructure their decades-long alliance, in a move that will see Renault transfer 28.4% of Nissan shares into a French trust, the companies said.
Voting rights in the trust would be “‘neutralized’ 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,” according to the Monday announcement. Renault would instruct the trustee to sell those shares if “commercially reasonable” and as part of a “coordinated and orderly process.”
The deal still pends board approvals, but would see Renault’s shareholdings in Nissan reduced from around 43% to 15%, bringing its interest down to equal the Japanese company’s current stake in Renault.
Both companies would be able to “freely exercise the voting rights attached to their 15% direct shareholdings, with a 15% cap,” the companies said.
The carmakers first signed their coalition in March 1999. The Monday deal comes after months of intense discussions.
As part of the agreement, Nissan would also invest in Ampere, Renault’s electric vehicle arm, while the two companies will embark on “high-value-creation operational projects” in Latin America, India and Europe.
— This is a breaking news story and will be updated shortly.