Business / Corporate

Renault to propose merger with Nissan under joint holding firm with equal board representation: sources

Kyodo

Renault SA will soon formally propose to partner Nissan Motor Co. that the two merge under a joint holding company, sources with knowledge of the matter said Friday as tensions continue to rise over control of one of the world’s leading auto groups.

Nissan is poised to reject the proposal because it is wary that Renault, which already has a 43.4 percent stake in it, will gain further influence over its management, the sources said. It rejected the idea of merging when Renault presented a plan earlier this month.

“Now is not the time for doing such a thing,” Nissan CEO Hiroto Saikawa told reporters Friday night in Tokyo, when asked about the proposal. “What is most important is (Nissan’s) business recovery.”

Renault wants to bring both together under a new structure that would have an equal number of board members from both sides, according to the sources.

The holding company would be headquartered in a third country but would be listed on stock exchanges in both France and Japan, the sources said.

The French government, Renault’s top shareholder, has been pushing for a merger with Nissan, looking to retain influence over the alliance, which became the world’s second-largest auto group in 2018 in terms of vehicle sales, sources familiar with the situation said earlier.

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