By Scott Kanowsky
Investing.com -- Renault SA (EPA:RENA) and Nissan Motor Co., Ltd. (TYO:7201) have received approval from their boards to go ahead with a restructuring of the 24-year old alliance between the two carmakers.
Under the revamped partnership, which was previously announced last month, Renault's stake in Nissan will fall to 15% from 43%, with 28.4% of its Nissan shares being transferred into a French trust where voting rights would be "neutralized" for most decisions. However, economic rights, including proceeds from dividends and share sales, would still benefit the manufacturer of models like Dacia and Alpine.
Nissan, meanwhile, will gain voting rights in its own 15% stake in Renault. It has agreed as well to invest up to 15% in Ampere, Renault's new electric vehicle spin-off.
The boards of both the French and Japanese groups also signed off on projects to develop new vehicle brands and technologies in Latin America, India, and Europe.
Renault and Nissan said they have reached a "binding framework agreement" regarding these moves, and are planning to solidify a "definitive" deal by the end of the first quarter. Once this stage is entered, the changes are expected to be completed in the fourth quarter after they are approved by regulators.
"We've been waiting a long time for this moment," noted Renault chairman Jean-Dominique Senard at a press conference following the announcement.
He added that the deal grants each company "the flexibility [...] to initiate new major projects" and "the possibility for the others to collaborate on these new opportunities not because they are forced to do so, but just because it is good for them."
Media reports have suggested that the relationship between Nissan and Renault was strained by the negotiations around the overhaul. However, top executives backed the deal, with Renault CEO Luca de Meo saying the revised arrangement not only equalizes the shareholder structure of the alliance but also helps optimize the future performance of both companies.