Renault to propose joint holding company with Nissan

Renault Clio Geneva Motor Show

Renault is going to propose a plan to form a joint holding company that would provide the French automaker and Japanese partner Nissan equal footing, a person with knowledge of the issue informed Reuters.

Under the proposal, both companies would nominate an equal number of directors to the new company, that would be led by Renault Chairman Jean-Dominique Senard, according to the person, who talked on condition of anonymity as the plan is not public.

The proposal would aim for further integration among the two automakers, the source stated.

The proposal was first reported on Friday by the Nikkei business daily, which stated that Renault expects to soon execute a plan to Nissan under which ordinary shares in both automakers would be moved to the new company on a balanced basis.

That would efficiently dilute the French government’s Renault stake to around 7-8 percent from 15 percent.

The newly-formed company would be headquartered in a third location, such as Singapore, the Nikkei and other Japanese media reported, without mentioning sources.

The proposal comes after the French automaker had asked Nissan with a merger idea prior to an alliance operational meeting previously this month, but Nissan CEO Hiroto Saikawa refused to discuss the issue with Senard, according to the Reuters source.

He added that the proposal could be modified before it was showed to Nissan.

The Financial Times newspaper reported that Nissan and the Japanese government refused to engage in merger talks with Renault and that Saikawa had refused to meet SMBC Nikko bankers authorized by the French automaker to work on a deal.

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