Reports emanating from mainstream business media over the weekend point to the high likelihood of a deal between FCA and Renault over a merger.
Both Financial Times and Wall Street Journal have reported Renault and FCA discussions at advanced stages, with the likelihood that Renault would announce a result before trading hours of the European bourses on Monday, with a Renault board meeting scheduled for 8.00 am locally.
Renault is part of the Renault-Nissan-Mitsubishi alliance which has come under pressure with the arrest of former chairman and industry icon Carlos Ghosn by Japanese authorities. He is currently facing four separate charges of financial crimes in connection with his position at Nissan in which Renault owns 43%. Nissan in turn owns 15% of Renault, but the French government holds a deciding stake through special arrangement.
It remains to be seen how an enlarged grouping will work out, especially considering the existing differences that are playing out in the FCA Group as well as the politics involved with the existing Alliance.
The Financial Times, quoting multiple people informed on the talks, said: “The agreement may ultimately lead the carmaker (Fiat-Chrysler) to join the Renault-Nissan-Mitsubishi Alliance in the future,” if Nissan could be won over. Such an alliance would become the world’s biggest, a title Renault-Nissan-Mitsubishi currently vies for with Germany’s Volkswagen.
– with inputs from Chandan Basu Mallik