Things are moving at Renault. While the group is due to present on November 8, at the time of its long-awaited investor day, the creation of two specific entities, “Ampère” dedicated to electric vehicles and “Horse” bringing together mechanical activities related to combustion engines, here comes the on the table the subject of cross-shareholdings within the Renault-Nissan Alliance. This morning, the two manufacturers issued a joint press release confirming joint initiatives to strengthen cooperation and the future of the Alliance, in particular, ” Nissan’s interest in investing in the new Renault EV entity which will support Renault’s Renaulution strategy and will be one of the strategic steps towards Nissan Ambition 2030.
A rebalancing requested by Nissan
And the stock market appreciates since the Renault share gained almost 7% at the start of the session and rose again by almost 5% at the start of the afternoon. This participation of Nissan in the “Ampère” project would only be, according to several people familiar with the matter, only one element of the operation, since it would be accompanied by an overhaul of the system of cross-shareholdings between the two groups. There would be a form of give and take, Nissan helping Renault in its electric ambitions and obtaining satisfaction in its desire to recover a certain capital independence.
For years, Nissan – which weighs much heavier than Renault, whether in turnover or market capitalization – has been demanding a rebalancing of the holdings inherited from 1999 when the Frenchman flew to the aid of a Japanese group in very bad shape. point. Renault thus owns 43.4% of Nissan, which only has 15% of the manufacturer with the diamond. This rebalancing had even been one of the missions entrusted to Carlos Ghosn shortly before his incredible arrest on the tarmac of a Tokyo airport! Since then, the situation had gradually calmed down between the French and the Japanese. At the start of the year, the partners of the Alliance presented their joint projects to the press and investors, aiming to pool an increasing number of components and platforms…but nothing in terms of capital.
From 43 to 15%?
Discussions for such an overhaul would have started shortly afterwards, in February, and they would have taken a much more concrete turn this weekend, on the occasion of the Formula 1 Grand Prix at Suzuka in Japan, at which assisted by Luca de Meo, the managing director of Renault, and Makoto Uchida and Ashwani Gupta, the numbers one and two of Nissan. It is true that time is running out: the objective would be to define the general lines of the reduction of Renault’s stake in Nissan before the famous investor day on 8 November. In a logic of balance between the two groups, this reduction should reduce Renault’s stake in Nissan to 15% (a level identical to that of Nissan in Renault) and would probably be spread over several years.
Renaut on the rise in a declining sector
By gradually selling its Nissan shares and welcoming it into the “Ampère” project, Renault would free up the financial resources needed to invest in electric vehicles. “Any rebalancing of Renault’s 6.1 billion stake in Nissan would be a step towards a better allocation of capital… and this is a key point of our investment case” notes Jefferies analyst Philippe Huchois in a note cited by Bloomberg. “The monetization of the share in Nissan was, for many shareholders, at the top of the possible catalysts”adds Tom Narayan of RBC who points out, however, that depriving himself of the dividend from Nissan can be a risk for Renault.
In the meantime, with the increase of the day, Renault is one of the three values of the Cac 40 in positive since the beginning of the year. An exception in the automotive sector: Stellantis lost 26%, Mercedes-Benz Group 21%, Volkswagen 29%, Tesla 44%… and Nissan 20%.