France Pushes for Renault-Nissan Merger

Renault-Nissan CEO Carlos Ghosn is being pressured by French Economy Minister Emmanuel Macron to fully merge the two companies, sources tell Reuters.

The sources say Macron believes a merger would help protect French factories and jobs. Under French law, Renault’s 43% stake in Nissan already gives it control over the Japanese company. Nissan, which owns a 15% nonvoting stake in Renault, contributes two-thirds of profits generated by the companies' 16-year-old alliance.

The French state increased its influence over Renault’s business decisions in April when it secretly upped its stake in the company to 19.7% from 15%. Under a new French law that takes effect next spring, the government’s voting rights will nearly double. Nissan has expressed worry over France’s growing clout in the alliance’s business affairs.

Reuters says Ghosn may counter with a merger plan he developed in 2013 with Goldman Sachs that would combine the companies but reduce the government’s holding.

Meanwhile, the Renault and Nissan boards are pushing the option of balancing each company’s stake in the other within a range of 25%-35%. The move also would give Nissan voting rights in the alliance.

Reuters speculates that an emergency Renault board meeting set for Friday could launch an adjustment of the shareholdings in defiance of the government’s preference.