Economy, Auto

Renault, Nissan to Strengthen Alliance

Renault, Nissan to Strengthen AllianceRenault, Nissan to Strengthen Alliance

Renault’s advisory board said on Friday it wants to strengthen its alliance with Nissan after the Japanese carmaker voiced concern over the French government increasing its voting rights in the French firm.

In a statement, Renault said it wanted to see a solution “reinforcing the alliance” with Nissan, with whom it has been linked for the past 16 years, AFP reported.

The 19-member advisory board said they had held talks with Renault’s two main long-term shareholders, the French state and Nissan, to allay Japanese concerns.

The French state raised its stake in Renault to 19.7% this year, disturbing the fragile balance between the two companies and angering Renault-Nissan boss Carlos Ghosn.

That bolstered Paris’ voting rights, effectively denying the Japanese company a say in how the business is operated.

It also prompted Nissan’s chief competitive officer, Hiroto Saikawa, to say his company had expressed its concerns to both the French and Japanese governments.

Under a new French law, long-term investors in French companies automatically receive double voting rights unless two-thirds of shareholders are opposed.

French Economy Minister Emmanuel Macron denied on Tuesday that there was any attempt from the French state to “destabilize” the alliance. He insisted the increase in the stake was temporary and Paris would reduce the holding soon.

Under the alliance agreement struck in 1999, Renault owns about 43% of Nissan. The latter holds about 15% of the French’s automaker’s shares, but without voting rights.