Nissan is 'absolutely not' in talks about selling its Mitsubishi stake

Nissan Motor Co is “absolutely not” in talks to sell its stake in Mitsubishi Motors Corp, Nissan's COO said on Monday, after a report the car maker was considering pulling out of its alliance partner.

“We are not in any discussion or consideration of changing the capital structure in our partner companies. We are moving ahead with many projects,” Ashwani Gupta said in an interview at the Reuters Automotive Summit teleconference.

He spoke after Bloomberg News reported earlier, citing unidentified sources, that Nissan was considering selling its 34% stake in Mitsubishi Motor to help it cope with the slump in demand caused by the Covid-19 pandemic.

Such a deal would fundamentally reshape a three-way alliance that includes France's Renault built by Carlos Ghosn, former chair of the alliance. The partnership was plunged into uncertainty when Ghosn was arrested in 2018 on financial misconduct charges, which he denies.

At Monday's closing price in Tokyo, Nissan's stake in Mitsubishi Motors was worth 102.2 billion yen (roughly R14,955,676,764).

Nissan shares rose 5% on the Bloomberg report, while Mitsubishi Motors, which said it would continue to collaborate with its alliance partner, gained 3%.

Nissan, which is 43% owned by Renault, last week cut its operating loss forecast for the year to March by 28%, helped by a rebound in demand, especially in China.

Mitsubishi Motors, Japan’s No 6 car maker, expects to post an operating loss of 140 billion yen (roughly R20,516,922,636) for its business year.

Both companies are cutting production levels and costs in a bid to return to profitability.

Reuters