Yesterday’s rumour is today’s reality: Nissan has just become Mitsubishi’s largest shareholder after buying a 34% stake in its Japanese rival, the two companies announced today.
The transaction is worth 237 billion yen (approx. $2.8 billion CAD) and should be completed by the end of this year after the signing of a definitive Alliance Agreement (late May), the signing of a shareholders agreement with the current Mitsubishi Group shareholders, and regulatory approvals.
This strategic alliance will extend an existing partnership between Nissan and Mitsubishi, under which the two companies have jointly collaborated for the past five years. They will work together in areas including purchasing, common vehicle platforms, technology sharing, joint plant utilization, and growth markets.
“This is a breakthrough transaction and a win-win for both Nissan and Mitsubishi Motors,” said Carlos Ghosn, chief executive and president of Nissan. “It creates a dynamic new force in the automotive industry that will cooperate intensively, and generate sizeable synergies. We will be the largest shareholder of MMC, respecting their brand, their history, and boosting their growth prospects. We will support MMC as they address their challenges and welcome them as the newest member of our enlarged Alliance family.”