Nissan Motor Co. will invest 237 billion yen (USD2.2 billion) to take a controlling 34% stake in Mitsubishi Motors. The purchase makes Nissan, Mitsubishi Motors’ single-largest shareholder. The companies said they plan to sign an agreement by May 25 in which Nissan can name four directors to Mitsubishi Motors’ board. A Nissan-appointed director can also be named chairman of Mitsubishi Motors, according to a filing this week. The deal will be invalid if not completed within a year.
Nissan is riding to Mitsubishi’s rescue after it called out Mitsubishi for cheating on emissions tests, plunging its close partner into crisis and uncertainty about its viability. Nissan CEO Carlos Ghosn and Mitsubishi CEO Osamu Masuko outlined the alliance after the boards of both companies met separately earlier today to sign off on the plans.
Ghosn said the alliance would cover purchasing, common platforms, joint manufacturing, technology development and target shared cost savings. Nissan would also contribute corporate governance and management expertise to help Mitsubishi restore public trust in its brand. “It represents a win-win,” Ghosn said. “We believe in the potential of Mitsubishi Motors.”
