Nissan and Mitsubishi Motors (MMC) announced Thursday May 12 that they have signed an agreement where Nissan will take a 34 per cent equity stake in MMC for 237 billion yen.
The strategic alliance will extend an existing partnership between Nissan and MMC, under which the two companies have collaborated for the past five years.
Nissan and MMC have agreed to cooperate in areas including purchasing, common vehicle platforms, technology sharing, joint plant utilisation, and growth markets.
Carlos Ghosn, chief executive and president of Nissan, said: “This is a breakthrough transaction and a win-win for both Nissan and Mitsubishi Motors. 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.”
Osamu Masuko, chairman of the board and chief executive of MMC, said: “Through its long history of successful partnerships, Nissan Motor has developed a deep knowledge of maximising the benefits from alliance partnerships. This agreement will create long term value needed for our two companies to progress towards the future. We will achieve long term value through deepening our strategic partnership including sharing resources such as development, as well as joint procurement.”
Under the terms of the transaction, Nissan will purchase 506.6 million newly-issued MMC shares at a price of 468.52 yen per share. Nissan will become the largest shareholder of MMC on closing.
