The Group Renault and the Nissan have agreed on a key framework to balance their 10-year alliance, in which Renault will reduce Nissan's controlling stake to 15% from 43%, while Nissan will receive a share in a new electric vehicle spinoff from Renault.
In joint statements on Monday, Nissan and Renault said the proposal was still subject to approval by their boards and that a formal announcement would come "immediately" after approval.
People familiar with the long-running talks, which began early last year, said the final structure of the agreement is expected to go to the boards for review and approval as early as this week.
An announcement could be made around 6 February.
"The ambition is to strengthen the Alliance's ties and maximise value creation for all stakeholders," the companies said.
Under the proposal, Renault would reduce Nissan's 43% share in Nissan to 15%, equal to Nissan's 15% share in Renault. Both parties would be able to exercise voting rights of up to 15 percent. Currently, Nissan has no voting rights attached to its stake - a long-standing source of contention.
Renault will transfer 28.4% of its shares to a French fund, where their voting rights will be "neutralised" for "most decisions", the companies said. However, Renault will retain rights to dividends and proceeds from share sales, thus maintaining the value of the stake.
The administrator will sell the shares "if it is commercially reasonable for the Renault Group in a coordinated and orderly process," the statement said, but there is no obligation to sell within a fixed timeframe.
Nissan will invest in EVs
At the same time, the companies said Nissan will invest in Ampere, a Renault start-up that will encompass the French automaker's electric vehicle and software business.
The declaration does not detail the size of this stake. But sources familiar with the negotiations say Nissan is ready to invest up to 15 percent. The exact level may be determined later.
Semiconductor technology company Qualcomm is also expected to take part in this venture.
The EV spinoff will focus primarily on the development and sale of fully electric vehicles that comply with strict European emissions regulations.
Nissan and its Japanese partner, Mitsubishi Motors, will have access to the technology for use in their European range. Nissan will also continue to work separately on its own EV technologies, the same sources said.
New joint projects
As part of the planned rebalancing, the companies said they will also strengthen their international cooperation with new operational projects in Latin America, India and Europe.
These new projects will address market penetration, vehicles and technologies.
Regarding the disparate cross-shareholdings between Renault and Nissan, which have long been a source of pressure and frustration at Nissan. Which on a more equal footing could usher in a new era that some have called Alliance 2.0. "We're close to a mega-new era," said one person close to the talks.
The reshuffle is the first major overhaul since Renault rescued Nissan from near bankruptcy in 1999 by taking control of the shares.
Gosn's arrest and the strained relations
The equalisation of stakes could ease tensions that have created tension between the companies, especially after the arrest of former Alliance chairman Carlos Ghosn in November 2018.
The update may also include a more transparent corporate governance agreement to replace the opaque Restated Master Alliance Agreement or RAMA, which has also been a bone of contention.
Renault and Nissan have been talking about rebalancing since early last year. A deal had been envisaged last November, but talks ended over concerns that Nissan's intellectual property could be leaked through Qualcomm to other industry competitors.
Those concerns have faded, paving the way for a new deal, a source familiar with the talks said.
