Renault, Nissan agree to further loosen alliance ties

Paris — Automakers Renault and Nissan said on Monday they had agreed to further amend their long-standing partnership to allow for a reduction in their cross-shareholdings to 10%, down from 15% previously.

The move comes a day before Ivan Espinosa takes over as CEO of the struggling Japanese carmaker, under pressure to boost its competitiveness.

Under the new terms, Nissan will also be released from its commitment to invest in Renault’s electric vehicle unit Ampere, in which it had pledged to invest €600m.

“As a long-time partner of Nissan within the alliance and as its main shareholder, Renault Group has a strong interest in seeing Nissan turn around its performance as quickly as possible,” said Renault CEO Luca de Meo in a statement.

Renault also announced its intention to buy out Nissan’s majority stake in their joint Indian business, known as Renault Nissan Automotive India, with completion of the deal expected by the end of the first half.

The French automaker confirmed its forecast of free cash flow of at least €2bn in 2025, despite an impact of about €200m from acquiring Nissan’s stake in the India business.

“Pragmatism and business-orientated mindset were at the core of our discussions to identify the most effective ways of supporting their recovery plan while developing value-creating business opportunities for Renault Group,” said De Meo.

Reuters