Renault said to offer Nissan concessions to strike deal

Jessica Thompson

Renault is offering some concessions to Nissan as the partners try to clinch a deal to reboot a two-decade alliance, according to people familiar with the situation.

Nissan’s independent board directors are due to meet early next week to consider several proposals by Renault, said the people, who asked not to be identified as the talks are private.

These include reassurances to help ease Nissan’s concerns over shared intellectual property, one of the sticking points in the negotiations, the people said.

There is also acknowledgment on Renault’s part that Nissan may invest less than hoped in the French carmaker’s EV business, called Ampere, that it’s currently carving out, the people said.

Renault has been targeting a roughly €10 billion valuation for the unit with a plan for a listing later this year, depending on market conditions.

Nissan does not agree with this valuation level and has made no decision yet on Ampere, said the people. It may end up buying less than the originally planned 15 percent stake, they said.

A spokesman for Renault declined to comment. Media representatives for Nissan based in Japan didn’t immediately respond to queries for comment outside office hours.

Complex split

Renault is in the middle of a complex split of its business into five different units while negotiating with Nissan ways to rebalance an alliance with lopsided capital ties that has become a source of friction over the years.

While Nissan CEO Makoto Uchida wants to move quickly with the agreement, the company’s independent directors are worried about the implications for the Japanese company from Renault’s reorganization, which has delayed the deal, several people said.

There is also concern over Renault’s legacy combustion-engine business partner, China’s Zhejiang Geely Holding Co., gaining access to joint technology.

Past pressure

The talks between the two companies and junior alliance partner Mitsubishi Motors got new impetus earlier this week when French President Emmanuel Macron met with Japan’s Prime Minister Fumio Kishida to reassure him that the French government backs Renault’s rebalancing plan and won’t seek a Renault-Nissan merger.

Past pressure for a merger from the French government, Renault’s most powerful investor with a 15 percent stake, is one of the reasons relations between the two companies became fraught over the years.

The rebalancing will mean Renault selling 28 percent of Nissan over time so that they each end up with equal, 15 percent holdings in the other company.

As part of the proposals currently under discussion, Nissan will not allow sharing of its e-Power hybrid technology within Horse, an entity Renault is creating for its legacy combustion-engine assets, the people said. Horse will be anequal partnership with Geely.

Renault Chairman Jean-Dominique Senard and CEO  Luca de Meo are expected to attend in person the next alliance operating board meeting in Japan at the end of the month, the people said.

No decisions have been yet made on when a possible non-binding agreement might be signed and planning of the various meetings could still change, the people said.

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