Renault approves merger with FCA
Merger resolution next week
The merger of Fiat Chrysler and Renault is apparently coming soon, because according to information from the news agency “Bloomberg” the French car manufacturer wants to agree to the offer. The merger shall be sealed already next week. Then the supervisory board of Renault will make the decision, according to “Bloomberg” with reference to insiders.
It is also said that Renault’s Chairman of the Board, Jean-Dominique Senard, will take over the management of the new group. In a meeting on Wednesday morning, Senard will explain the reasons for the merger to Renault partners Nissan and Mitsubishi. A merger with Nissan is not planned, but the Japanese could possibly bundle the forces of the companies.
After Renault Chairman and CEO Carlos Ghosn was arrested for alleged violations of stock exchange regulations in Japan, the Franco-Japanese Auto Alliance plunged into a crisis. Fiat Chrysler also suffered a defeat with the recent early death of its long-time boss Sergio Marchionne.
First of all, the merger will take place without the Japanese partners. According to Fiat Chrysler’s proposal, both groups could each own half of the new company. The merger could result in annual savings of five billion euros. Together, 8.7 vehicles would be sold annually.
If the Japanese get on board, the savings could be increased by another billion euros. Sales with FCA, Renault, Nissan and Mitsubishi would then amount to over 15 million vehicles. This means that Volkswagen and Toyota would be clearly outstripped with 10 million vehicles each.