[News] Honda Reportedly Urges Nissan to Acquire Renault Stake to Prevent Third-Party Influence in Merger

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Japanese automobile giants Honda and Nissan have entered formal discussions to merge a month ago, as they aim to become the world’s third-largest automaker by sales. However, to further rule out the possibility that third party ownership could impact negotiations, Honda is said to be urging Nissan to acquire shares held by its French partner Renault, as noted by Japanese media outlet Kyodo News.

As indicated by a previous report from Nikkei, Taiwan’s Foxconn has been quietly pursuing a stake in Nissan for several months. The company has reportedly been showing interests in purchasing Nissan shares from Renault, making this a critical point in the discussions, the Kyodo News report adds.

Foxconn has indeed shown its ambition in the EV sector. In October, 2024, it announced two, new reference electric vehicles, extending its automotive range with the MODEL D, a lifestyle multipurpose utility vehicle, and the MODEL U, a midi-sized electric bus, as per its press release.

According to Kyodo News, in 2023, Renault agreed to balance its capital relationship with Nissan by lowering its stake from 43.4% to 15%. Shares held in a trust are being gradually sold, with Nissan or its designated third party having priority as buyers, the report indicates.

Therefore, it is understood that Honda is urging Nissan to prioritize acquiring the shares directly to prevent unintended third-party influence on its governance, the report notes. Renault currently holds a 17.05% direct stake in Nissan and 18.66% in trust, with Honda emphasizing action on the trust-held shares, as per Kyodo News.

Another Bloomberg report notes that if Honda, Nissan, and Mitsubishi were to merge, the combined group would reach a market value of approximately USD 57 billion. Mitsubishi Motors plans to make a final decision on its role and involvement in the potential business integration between Nissan and Honda by the end of January 2025.

Read more

• [News] Honda and Nissan Reportedly Enter Merger Talks Amid Rising EV Competition from China
• [News] Honda-Nissan Merger Talks Reportedly Spurred by Concerns over Foxconn’s Potential Acquisition

(Photo credit: Honda)