Negotiations are ‘accelerating’ between Renault and Nissan concerning the restructuring of their alliance with a refocusing on the electric of the French manufacturer, but points still remain to be settled, according to a source familiar with the matter interviewed on Monday by AFP.
Several media this weekend reported that Renault might reduce its stake in Nissan to 15% from 43% currently. In return, the Japanese manufacturer, which itself currently owns 15% of Renault, would invest in ‘Ampère’, the future electrical entity of its French partner.
Renault and Nissan confirmed in a joint press release on Monday “discussions” on “several initiatives” to “strengthen cooperation”, citing the possibility of an “agreement around several joint strategic initiatives”.
The action of Renault jumped more than 6% at the opening of the Paris Stock Exchange, to more than 32 euros, in a market in slight decline.
According to the statement, Nissan ‘plans to invest in Renault’s new entity’ dedicated to electric mobility and the two companies ‘continue to make progress on structural improvements’ of the alliance in terms of ‘operations and governance’. .
“Nissan will invest in Ampère, that’s for sure” and will become the “second largest shareholder” following Renault, a source familiar with the matter in Japan confirmed to AFP.
But it is still too early to quantify this investment, just like the extent of the decline in Renault’s stake in Nissan, said the same source.
This partial disengagement of Renault in Nissan should have a ‘deferred execution’ and be carried out in stages to avoid massive depreciations for the French manufacturer. Because currently the value of Nissan shares is ‘well below their value recorded in the accounts of Renault’.
In addition, Nissan ‘will not invest’ in ‘Horse’, Renault’s thermal division, which would only keep 35% and would sell the rest to the Chinese manufacturer Geely and the Saudi oil group Aramco, according to the same source.
But ‘Horse’ is the subject of ‘very technical’ discussions between Renault and Nissan, because many innovations in this area have been developed jointly by the two groups and the Japanese manufacturer wishes to ‘take the fair return of its intellectual property’ .
The rebalancing of the Alliance also necessarily implies a reform of its governance, and the place given to its third member, Mitsubishi Motors, also remains to be clarified.
New Alliance projects should also be added, relating to specific geographical areas and market segments, according to the source interviewed by AFP.
All these subjects are closely linked and must therefore be tackled simultaneously. Negotiations between Renault and Nissan, which have been going on for months, have “accelerated since the end of August” and are expected to intensify further by November.
Renault, whose managing director Luca de Meo is currently in Japan, is due to present an ‘update’ on its strategy in Paris on November 8. But the concrete consequences on the Alliance should be announced later by the three manufacturers, not before ‘mid-November’, according to the same source.
/ATS
