Nissan has reportedly been asked to acquire the shares held by its Renault alliance partner – worth $AU5.8 billion – as merger discussions with Honda continue.
Honda has reportedly asked Nissan to buy out the shares held by France’s Renault ahead of a likely merger between the two Japanese brands.
Bloomberg News reports Honda has enquired if Nissan is in a position to acquire Renault’s shareholding amid concerns of foreign influence if Renault’s stake is bought by another party – such as Taiwan’s Foxconn – while merger discussions continue.
Renault has a 35.7 per cent stake in Nissan worth approximately 557 billion yen ($AU5.8 billion), according to Bloomberg.
Nissan and Renault formed an alliance in 1999 – with Mitsubishi joining in 2016 – seeing Renault’s share in Nissan reach as high as 43 per cent but fall to 35.7 per cent after several sales in 2023 and 2024.
The Renault Group remains the largest current shareholder in Nissan.
Honda’s concern follows reports Foxconn – a contract manufacturer known for making the iPhone for Apple – was looking into buying Nissan in a bid to enter the electric vehicle market, with a takeover of Renault’s shares an area of interest after unfavourable discussions with Nissan.
MORE: Nissan, Honda, and Mitsubishi in talks to merge – Official
However it is unclear if Nissan would be in a financial position to buy out Renault’s 35.7 per cent share, with cash and cash equivalents of around 1.52 trillion yen (AU$15.7 billion) as of 31 December 2024.
In November 2024, Nissan reported a 0.5 per cent operating profit margin for the first half of the current Japanese financial year – a 90 per cent decline from the same period in the previous financial year.
Executives from Honda and Nissan have dismissed claims the merger is intended to “save” or “bail out” Nissan.
MORE: Nissan merger not intended to ‘bail out’ struggling brand, claims Honda
In a media conference in December 2024, Honda CEO Toshihiro Mibe said the merger would not continue if “turnaround measures” to improve Nissan’s current financial woes are unsuccessful.
“As I have been saying repeatedly, as a major assumption there has to be the implementation of turnaround measures by Nissan. That is an absolute condition,” Mibe said.
“And if we are to attain our goal, the two companies have to be able to stand on their own feet. Unless that criteria is fulfilled, we will never be able to attain our common goals.”
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