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 | Good pictures
Automobile giants Renault And Nissan It agreed on Monday to restructure their decades-old alliance, which will see Renault’s stake in Nissan cut from about 43% to 15%.
The deal, which is still pending board approvals, will equalize the companies’ cross-stakeholdings, with the carmakers now “free to exercise voting rights attached to their 15% direct shares with a 15% cap,” the companies said.
The new structure will see the French trust transfer a 28.4% stake in Renault Nissan.
Voting rights in trust will be “neutralized” for most decisions, but economic rights (dividends and proceeds from the sale of shares) will fully benefit Renault until such shares are sold,” Monday’s announcement said.
Renault will instruct the trustee to sell the shares if it is “commercially reasonable” and part of an “integrated and orderly process”.
The car makers first signed their alliance in March 1999. Mitsubishi Motors In 2016, Monday’s agreement came after months of intense discussions over the restructuring of the Franco-Japanese alliance.
As part of the deal, Nissan will invest in Renault’s electric vehicle division Ampere, while the two companies will undertake “high value-creating operational projects” in Latin America, India and Europe.
Renault announced in November that it had signed a non-binding framework agreement with China Kiely to establish a new company that will manufacture hybrid powertrains and “highly efficient ICE [internal combustion engine] Powertrains.”
The French giant has also made an entry Long term strategic cooperation with the American chipmaker Qualcomm.
Renault shares fell 1.4% in early trade in Europe, while Nissan shares fell 0.7% in Asian trading hours overnight.