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Tokyo court denies latest bail request of Nissan's Ghosn

Stock MarketsJan 21, 2019 11:48PM ET
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© Reuters. FILE PHOTO: Carlos Ghosn, Chairman and CEO of the Renault-Nissan Alliance, poses after the Renault's 2015 annual results presentation at their headquarters in Boulogne-Billancourt

TOKYO (Reuters) - Carlos Ghosn's latest request for bail was rejected by a Tokyo court on Tuesday, despite the ousted Nissan chairman offering to wear an electronic ankle tag in an unusual bid to win release after two months of detention for alleged financial crimes.

The ruling, widely anticipated, raises the likelihood that the 64-year-old executive will remain in custody until his trial, and will put pressure on Nissan's (T:7201) French partner Renault SA (PA:RENA) to find his successor as chairman and CEO.

Renault's board is expected to meet in the coming days to decide who will succeed Ghosn, essentially removing him from the three-way alliance - which also includes Mitsubishi Motors (T:7211) - which has been in turmoil since his arrest.

Ghosn was almost immediately ousted from the chairmanship of Nissan and Mitsubishi after his initial arrest on Nov. 19, but remains chairman and CEO of their French partner.

He has been officially charged for under-reporting his salary for eight years through March 2018 and temporarily transferring personal financial losses to Nissan's books. Ghosn denies the charges.

The court did not give a reason for the denial. Bail is rarely granted for defendants in Japan without a confession.

Ghosn's lawyer was not immediately available for comment after the Tokyo District Court announced its decision.

Ghosn's latest bail request had also included an offer to hire guards to monitor him and a promise to remain in Tokyo, where he has leased an apartment. He offered to post stock he owns in Nissan as collateral, his spokeswoman said.

An earlier request for bail was denied last week due to concerns the executive, who holds French, Lebanese and Brazilian citizenship, was a flight risk, and that he may tamper with evidence if released.

In a statement released on Monday, Ghosn repeated his intent to clear his name in court.

"I will attend my trial not only because I am legally obligated to do so, but because I am eager to finally have the opportunity to defend myself," he said.

"I am not guilty of the charges against me and I look forward to defending my reputation in the courtroom."

PARTNERSHIP IN TURMOIL

The arrest of the once-feted executive who orchestrated the turnaround of Nissan two decades ago, has clouded the future of the partnership between Nissan and Renault.

Ghosn had pushed for a deeper tie-up between Nissan and Renault, including possibly a full merger, despite strong reservations at the Japanese firm.

On Monday, Nissan CEO Hiroto Saikawa said it was not the time to discuss revising the partners' complicated capital ties. Local media have reported that a French government delegation has informed Tokyo that it would seek an integration of Renault and Nissan, most likely under the umbrella of a single holding company.

Renault owns a 43.4 percent stake in Nissan, which in turn holds a non-voting 15 percent stake in Renault. The French government owns a 15 percent voting stake in Renault.

Nissan, which has been conducting an internal probe into misconduct by Ghosn, believes he misused company funds for personal purposes, including payments related to his compensation, his residences dotted around the globe, and payments to family members, people with knowledge of the issue have told Reuters.

Tokyo court denies latest bail request of Nissan's Ghosn
 

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