Nissan May Back FCA-Renault Merger After Equity Sale

Nissan would support a proposed merger between Renault and Fiat Chrysler Automobiles if Renault sharply reduces its 43% ownership in the Japanese carmaker, according to Reuters.

Sources tell the news service that FCA and Renault are scrambling to find a way to revive their proposed $35 billion merger, which was revealed only two weeks ago. FCA abruptly withdrew its bid last Wednesday, blaming French politics. But Nissan’s reluctance to support the deal also contributed.

It isn’t clear whether a renewed effort to reboot the complex offer would succeed. Complicating any option is Renault’s 20-year-old equity alliance with Nissan, and the French government’s 15% stake in Renault.

Renault holds a 43% voting stake in Nissan, and Nissan owns a 15% nonvoting stake in Renault. For the past year, Renault has been trying to coax Nissan into a merger.

Nissan was near bankruptcy when its alliance with Renault began. But Nissan and its Mitsubishi Motors affiliate have since become the majority contributor to the partnership’s sales volume and revenue.

For more than a year Nissan has grumbled over Renault’s control over the alliance and the French state’s interference in its business decisions. The Japanese company has been pushing for a more balanced equity arrangement for more than a year.