Renault Summons Board in Response to French Stake Hike, Report Says
16 April 2015 - Automotive News
Renault will hold an emergency board meeting today in response to French government moves to tighten its grip on the carmaker and its alliance with Nissan, a company source with knowledge of the matter said.
The afternoon board session has been scheduled to discuss "shareholding changes," the source said, after France raised its Renault stake to bolster its influence over the company in a challenge to Carlos Ghosn, who leads both Renault and Nissan.
Neither Renault nor the French government responded to calls and messages seeking comment.
The French state unveiled moves on April 8 to increase its Renault holding to 19.7% from 15%, and to block a shareholder resolution proposed by Ghosn that would maintain one vote per share in the company.
Legislation introduced under Socialist President Francois Hollande doubles the voting rights of longer-term shareholders in companies that do not explicitly opt out of the so-called Florange law by a two-thirds majority vote.
By blocking the opt-out at the April 30 shareholder meeting, the government aims to increase its own clout at the risk of destabilizing Renault's alliance with Nissan, in which it has a 43.4% stake.
Nissan holds a reciprocal 15% of Renault but no voting rights -- a sore spot in their 16-year alliance -- because the larger Japanese group is deemed to be under Renault's control.
The source did not say what options would be considered at the board meeting.
Measures to re-balance the alliance have been considered in the past, according to Renault and Nissan insiders -- including a Nissan capital increase or a reduction of Renault's stake. Either could renew Nissan's voting rights in Renault.