This decision will finally eliminate the shareholding disparity between the partners.
“The agreements that have been signed today allow us to step into the next chapter of the Alliance. They strengthen our long-standing partnership and will maximize value creation for each Alliance member. This also lays the foundations for a new balanced, fair, and effective governance.“
Jean-Dominique Senard, Chairman of The Alliance
As mentioned, the Japanese automaker committed roughly 600 million euros ($663 million) to Renault’s EV unit Ampere.
Both companies will maintain 15% cross-shareholdings in each other. Meanwhile, Renault agreed to move 28.4% of its Nissan stakes into a French trust. It will help them retain the voting rights of each party at 15% of the total.
“Renault Group and Nissan will retain cross-shareholdings of 15% with lock-up and standstill obligations. Renault will transfer 28.4% of its Nissan shares into a French trust, where the entrusted shares will be voted neutrally, subject to limited exceptions. Renault Group would continue to fully benefit from the economic rights (dividends and proceeds of share sales) from the entrusted shares until such shares are sold. The transfer to the trust would trigger no impairment in Renault Group’s financial statements.
As a result of the transfer of the 28.4% of Nissan shares to the trust, Nissan would be able to exercise its voting rights attached to its shareholding in Renault Group. The voting rights of Renault Group and Nissan would be capped at 15% of the exercisable voting rights, with both companies able to freely exercise their voting rights within such limit.”
Nissan and Renault’s joint press statement
However, it must be noted that these revisions still need to pass regulatory approval.
What’s the big deal?
After months of rough negotiations, the new agreement between the long-standing partners is undoubtedly positive news. As per sources familiar with the matter, the talks were stuck partly due to Nissan’s concern over its intellectual property protection in future partnerships.
In addition, it also enables the Japanese company to prioritize more alarming issues it currently faces in China. Japanese automakers are waning in the world’s largest auto market amid the ongoing price war.
Nissan CEO Makoto Uchida also stated that the major investment “complements and strengthens Nissan’s ongoing electric push in Europe.”
- Nissan to invest 15% in Renault’s Ampere under their restructured partnership
- Nissan and Renaults reworking on partnership deal
- Renault Considering Nissan Stake Sale to Fund EV Transition
- Renault to produce a sub-$32,500 electric car, per report
- Renault-owned Alpine previews electric hot hatch concept, production version to launch in 2023
This revamped alliance will aid the two companies in catching up in the highly competitive electric vehicle industry in Europe. Nonetheless, the partners noted that the changes remain subject to regulatory approvals, with completion anticipated in Q4 2023.