Renault and Nissan agreed on Monday to reorganize their decades-long partnership, reducing Renault’s stake in Nissan from approximately 43% to 15%.
The agreement, which is still subject to board approval, would equalize the firms’ cross-shareholdings, allowing the automakers to “freely exercise the voting rights linked to their 15% direct shareholdings, with a 15% ceiling,” according to the companies.
Renault would also transfer 28.4% of Nissan shares into a French trust under the new structure.
Voting rights in the trust would be” ‘neutralized’ for most of the choices, but the economic rights (dividends and shares’ sale revenues) would continue totally benefit to Renault until such shares are sold,” according to the Monday statement.
Renault would direct the trustee to sell the shares provided they were “commercially reasonable” and part of a “planned and orderly procedure.”
The automakers formed their alliance in March 1999, later expanding it to include junior partner Mitsubishi Motors in 2016. The agreement reached on Monday comes after months of rigorous negotiations on the revamp of the Franco-Japanese partnership.
Nissan will also invest in Ampere, Renault’s electric car division, as part of the arrangement, and the two firms will start on “high-value-creation operational initiatives” in Latin America, India, and Europe.
In November, Renault announced the signing of a non-binding framework agreement with China’s Geely to develop a new firm producing hybrid powertrains and “extremely efficient ICE [internal combustion engine] powertrains.”
The French conglomerate has also formed a long-term strategic alliance with the American chipmaker Qualcomm.
Renault shares fell 1.4% in early European trade, while Nissan shares fell 0.7% overnight in Asia.