William Maley

Mitsubishi News: Nissan Will Purchase 34 Percent of Mitsubishi

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William Maley    391

In under 24 hours, the rumor has become reality. Nissan will acquire 34 percent of Mitsubishi Motors for 237 billion yen (about $2.17 billion). This makes Nissan the single-largest shareholder in the automaker.

 

Speaking at a press briefing announcing the deal, Nissan CEO Carlos Ghosn said this alliance will cover purchasing, common platforms, joint manufacturing, technology development, and target shared cost savings. The alliance will also contribute management expertise to help Mitsubishi regain public trust.

 

“It represents a win-win. We believe in the potential of Mitsubishi Motors,” said Ghosn.

 

In statements from the two companies, an agreement will be signed by May 25th where Nissan can name four directors to the Mitsubishi Motors board. Nissan can also name one of their directors as a chairman for Mitsubishi.

 

Osamu Masuko, chairman of Mitsubishi Motors explained the two companies have been discussing ways to extend their partnership for some time. Mitsubishi and Nissan currently have a deal concerning minicars. When the scandal came to light, the talks accelerated.

 

“We had to do something quite daring. It is not an easy task to restore trust,” said Masuko.

 

Makuko also notes that a takeover like this would have happened sooner or later due to Mitsubishi lacking the resources to compete effectively on its own.

 

“This would have happened one day,” he said.

 

This deal does open Nissan to possible issues concerning the problems facing Mitsubishi and how much money will need to be spent. Ghosn explained that Mitsubishi was very open about the scale of problems it faces and that Nissan would only complete the deal after it has done an investigation into the investment.

 

Source: Automotive News (Subscription Required), New York Times, Mitsubishi, Nissan

 

Press Release is on Page 2






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regfootball    234

this likely means Mitsubishi can be the brand for the 'lesser markets' and emerging markets, and to be honest is probably a lifeline for them.  And, they can have a better chance of remaining relevant and keeping up on tech.

 

I think a cpl years back everyone predicted that there would be some consolidation in the Japanese companies and this is a step to that.  Toyota may ultimately end up with all of Subaru and Mazda.  Honda may be left pissing in the wind.  Nissan will absorb Mits.  Suzuki will probably get sucked up by Tata or something.

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dfelt    1,763

Yup, the Japan consolidation is just beginning. I suspect over the next 18-24 months we will see more of these deals and the top three will end up being Toyota, Nissan and Honda with the rest of the name plates being under these three.

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