Report: Nissan, French Government Strike Deal in Renault Spat

Nissan and the French government struck a deal Friday to end a dispute over how much influence the state has over the carmaking alliance between the Japanese automaker and Renault, according to Renault.

The French government will cap its voting rights between 17.9 percent and 20 percent in non-strategic shareholder decisions, and will preclude “interference” by the government in Nissan by Renault. Renault, which is partially state-owned, is Nissan’s largest shareholder.

Earlier this year, France passed a law that would have given the government increased voting rights in the alliance, perhaps in an attempt to forge a stronger partnership between the two automakers.

According to a statement by Renault, the government would only exercise its double-voting rights in extraordinary circumstances, such as:

… changes to or the termination of RAMA (Restated Alliance Master Agreement), the enfranchisement of Nissan shares in Renault, a takeover bid of Renault and the passing by any shareholder, including Nissan, of the 15 percent threshold either in shareholding or in voting rights.

Renault will exercise its double-voting share for dividends, the appointment or dismissal of French government officials to Renault’s executive board and big-spending items over 50 percent of Renault’s assets.

French authorities increased their stake in the automaker this year without prior notice to Nissan, a salvo that prompted the Japanese automaker to consider an alliance that would have left the government with a greatly reduced role in decisions.

French minister Emmanuel Macron said the government wanted to protect its workers at Renault factories, but ultimately backed down the government’s interest in the two automakers.

Friday’s news could be a capitulation by the government to concede that the partnership — initially drafted to help save Nissan — has significantly changed since 1999, and that Renault, not Nissan, now needs help to stay viable.