Renault slashes Nissan stake as automakers overhaul their decades-old alliance

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Renault and Nissan logos are pictured during the Brussels Motor Show in Brussels on January 9, 2020. (Photo via Kenzo Tribouillard/AFP Getty Images)

Kenzo Tribouillard | AFP | Getty Images

giants Renault And Nissan The companies agreed on Monday to reorganize their decades-old alliance, in a move Renault would transfer 28.4% of Nissan’s shares to a French trust, the companies said.

According to Monday’s announcement, voting rights in the trust “will be ‘neutralised’ for most decisions, economic rights (dividends and shares sale proceeds) will still benefit Renault as a whole.” Renault will instruct the trustee to sell those shares if “commercially appropriate” and as part of a “coordinated and systematic process”.

The deal is still pending board approval, will see Renault’s stake in Nissan drop from about 43% to 15%, reducing an interest equal to the Japanese company’s existing stake in Renault.

The companies said both the companies “will be able to independently exercise the voting rights attached to their 15% direct shareholding subject to a 15% cap”.

The carmakers first signed their alliance in March 1999. Monday’s deal comes after months of intense discussions.

As part of the agreement, Nissan will also invest in the Ampere, Renault’s electric vehicle arm, while both companies will undertake “high-value-creating operational projects” in Latin America, India and Europe.