Lead
Introduction
The unequality of status and strength is the pain point of the factional struggle within Nissan executives, and at the same time, the relationship between Renault-Nissan-Mitsubishi alliance was once shaken.
Author 丨 North Shore
Responsible editor 丨 Cao Jiadong
Editor 丨Zhu Jinbin
Renault group is considering selling some of its Nissan stake, which could raise billions of euros for its electrification transition and ease long-standing tensions with its alliance partners, people familiar with the matter recently revealed.
It is reported that Nissan may be willing to buy some of the shares held by Renault, or seek other acquirers to acquire some of its own shares. Renault currently holds 1.83 billion shares in Nissan, or 43 percent, and both companies declined to comment on the news.
If Renault does choose to cut its stake in Nissan, the European manufacturer is planning to take a new path and try to reshape the 23-year-old alliance on the basis of the renault-Nissan-Mitsubishi disintegration.
The Renault-Nissan-Mitsubishi alliance has always had an unbalanced cross-shareholding structure: the French government holds 15% of Renault's shares, is Renault's largest shareholder, and has dual voting rights; Renault holds 43.4% of Nissan's shares and has full voting rights; Nissan holds only 15% of Renault's shares and has no voting rights.
The unequality of status and strength is the pain point of the factional struggle within Nissan executives, and at the same time, the relationship between Renault-Nissan-Mitsubishi alliance was once shaken.
Renault CEO Luca de Meo outlined a blueprint for major structural changes for the group in February, and more recently, further confirmed the potential possibility that Renault's electric vehicle business will be spun off and listed separately.
Just yesterday, Renault treasurer Terrry Pieton said the possibility of separating the EV business had been "on the table" at group level, including the possibility of going public on its own in the second half of 2023. But any plan to "split the traditional fuel into electrification businesses" would have to be approved by its alliance partner Nissan.
According to people familiar with the matter, the negotiations to reshape the relationship between Renault and Nissan alliance have not been publicly discussed so far, and it may take months for the two companies to sit down and seriously negotiate. However, renault's electric vehicle business will most likely include Nissan's assets, and after the two major businesses have embarked on the "operating table", Nissan is still a partner of Renault's traditional fuel business.
European analysts believe that if Renault decides to sell part of its stake in Nissan, Nissan will choose to buy back, which is a relatively good buyback opportunity for the latter. Nissan currently has a stronger cash flow on hand than it did a year ago, and according to the latest data analysis, the Japanese automaker has at least 2 trillion yen (about 101.3 billion yuan) of cash and equivalents, and its operating profit is expected to grow positively for the first time since 2019.
Ashwani Gupta, Nissan's chief operating officer and former Renault group executive, will travel to Paris next week for a private meeting with Renault boss De Mayo, and then Renault and Nissan executives will hold a broader discussion in Tokyo next month.
Due to the long-term fermentation of the asymmetrical relationship between Renault and Nissan, its contradictions directly destroyed the strong era belonging to Carlos Ghosn, the former chairman of Nissan. After Ghosn's ouster, Nissan experienced more than a year of internal turmoil, but after a special period of frequent high-level blood changes and a wavering development path, the Toei giant has been focusing on separate internal reforms to mitigate the negative damage caused by Ghosn's arrest and new crown pneumonia.
Negotiations to rebalance the Renault-Nissan-Mitsubishi alliance actually began in 2019, but the three automakers are well aware that what is more urgent at that time is their homeopathic reforms in the era of electrification and the reshaping of operations and management in the new era. Because of this, the redistribution of the interests of the three companies, especially the rebalancing of power between Renault and Nissan, has also been temporarily ignored.
Reducing Renault's stake in Nissan to 15 percent is roughly the same as Nissan's ownership of Renault, and at current prices, it could yield renault a gain of about €4.65 billion. As things stand, Renault is unlikely to sell all of its Nissan holdings, as the result is an overall weakening of the alliance's strength.
It is worth mentioning that at a critical juncture when Renault and Nissan's electrification transformation enters the deep water area, any change at the alliance level will lead to the complexity of the two companies' new spin-off business. But no matter how equity interests are redistributed, it is certain that in the face of the difficult problems of the new four modernization era, the three companies will only bind each other more tightly on the alliance.
| north shore |
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