Nissan probe expanding to Renault

Nissan probe expanding to Renault

Nissan’s investigation into alleged misconduct by chairman, Carlos Ghosn, is expanding to include Renault-Nissan finances, sources told Reuters, in a further sign that Nissan may seek to loosen its French parent’s hold on their global carmaking alliance.

Earlier this week, Nissan told Renault’s board it had evidence of potential wrongdoing at Renault-Nissan, the venture overseeing alliance operations under Renault’s ultimate control, according to sources.

The Japanese carmaker, 43.4% owned by Renault, has announced that an investigation uncovered misconduct involving Mr Ghosn, including under-reporting of his compensation and personal use of company assets.

Nissan chief executive, Hiroto Saikawa, once Mr Ghosn’s protégé, also disclosed plans to strip Mr Ghosn of his chairmanship, after the 64-year-old industry veteran was arrested in Tokyo, along with fellow director, Greg Kelly, an American.

Neither of the detained men has had the opportunity to comment publicly on the allegations against them.

The 19-year history of the Renault-Nissan alliance, enlarged in 2016 to include Mitsubishi Motors, has been marked by tensions among the carmakers and the French government, Renault’s main shareholder, with 15%.

Under government pressure, Mr Ghosn, who is also Renault chairman and CEO, had agreed, this year, to explore a closer tie-up that would tap deeper synergies, safeguard French industrial interests, and make the alliance “irreversible”. The plan raised hackles in Tokyo.

Nissan, while almost 60% bigger than Renault by sales, remains the junior partner in their shareholding hierarchy, with a smaller, reciprocal, 15% non-voting stake in Renault.

Renault chief operating officer, Thierry Bollore, has won the backing of the French government to become interim chief executive officer, following Mr Ghosn’s arrest in Japan, sources say.

The French state is also expected to support lead board director, Philippe Lagayette, as non-executive chairman to fill Mr Ghosn’s other role.

The move would elevate Mr Bollore, who has been seen as Mr Ghosn’s heir apparent since February, when he was promoted to chief operating officer, and allow him to take over the day-to-day running of Renault.

The French government has distanced itself from Mr Ghosn, with finance minister, Bruno Le Maire, saying he was “not in a position to run the group”.

Renault shares have tumbled since news of Ghosn’s arrest. They fell 4.8% yesterday, after an 8.4% drop the day before. Nisan shares fell a further 5%.

Reuters and Bloomberg

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