(Yokohama and Tokyo) – May 12, 2016. Nissan Motor Co., Ltd., (“Nissan”), and Mitsubishi Motors Corporation, (“MMC”) announced that they have signed a Basic Agreement today to form a far-reaching strategic alliance between the two Japanese automakers.
Following an MMC share issue, Nissan will take a 34% equity stake in MMC for 237 billion yen.
The strategic alliance will extend an existing partnership between Nissan and MMC, under which the two companies have jointly collaborated for the past five years.
Nissan and MMC have agreed to cooperate in areas including purchasing, common vehicle platforms, technology-sharing, joint plant utilization and growth markets.
Carlos Ghosn, chief executive and president of Nissan, said: “This is a breakthrough transaction and a win-win for both Nissan and Mitsubishi Motors. It creates a dynamic new force in the automotive industry that will cooperate intensively, and generate sizeable synergies. We will be the largest shareholder of MMC, respecting their brand, their history and boosting their growth prospects. We will support MMC as they address their challenges and welcome them as the newest member of our enlarged Alliance family.”
Osamu Masuko, chairman of the board and chief executive of MMC, said: “Through its long history of successful partnerships Nissan Motor has developed a deep knowledge of maximizing the benefits from alliance partnerships. This agreement will create long term value needed for our two companies to progress towards the future. We will achieve long term value through deepening our strategic partnership including sharing resources such as development, as well as joint procurement.”
Under the terms of the transaction, Nissan will purchase 506.6 million newly-issued MMC shares at a price of 468.52 yen per share. The price per share reflects the volume weighted average price over the period between April 21 2016 and including May 11 2016. Nissan will become the largest shareholder of MMC on closing.
MMC and Nissan expect Mitsubishi Heavy Industries, Mitsubishi Corporation and The Bank of Tokyo – Mitsubishi UFJ to maintain a significant collective ownership stake in Mitsubishi Motors, and to support the strategic alliance.
The transaction is subject to the signing of a definitive Alliance Agreement, expected by the end of May, 2016, the signing of a shareholders agreement with the current Mitsubishi Group shareholders of MMC and regulatory approvals. It is expected to close by the end of the year.
The decision by Nissan to acquire a strategic stake in MMC marks the latest expansion of its Alliance model, built around a 17-year cross shareholding arrangement with Renault. Nissan has also acquired stakes or signed partnerships with other automotive groups including Daimler, and AvtoVaz.
On closing, MMC will propose Nissan nominees as board directors in proportion to Nissan’s voting rights, including a Nissan nominee to become Chairman of the Board.
Joint press conference
Time: 16:00 to 16:45 JST
Venue: TKP Garden City Yokohama
The press conference will be livestreamed here: http://www.ustream.tv/channel/nissan-newsroom2
About Nissan Motor Co., Ltd.
Nissan is a global full-line vehicle manufacturer that sells more than 60 models under the Nissan, Infiniti and Datsun brands. In fiscal year 2014, the company sold more than 5.3 million vehicles globally, generating revenue of 11.3 trillion yen. Nissan engineers, manufactures and markets the world's best-selling all-electric vehicle in history, the Nissan LEAF. Nissan’s global headquarters in Yokohama, Japan manages operations in six regions: ASEAN & Oceania; Africa, Middle East & India; China; Europe; Latin America and North America. Nissan has a global workforce of 247,500, and has been partnered with French manufacturer Renault under the Renault-Nissan Alliance since March 1999.
About Mitsubishi Motors Corporation (MMC)
MMC is a Japanese automobile company which has a competitive edge in light trucks (pick-up trucks and SUVs) and in the ASEAN region. The company launched the first mass-produced electric vehicle in 2009, which was followed with a plug-in hybrid EV-based crossover in 2013. MMC, which has 30,000 employees, has a global footprint and has production facilities in Japan, Thailand, China, The Philippines and Russia. Models such as the Pajero Sport, Triton and Outlander play a major role in achieving its growth. Global sales volume in fiscal year 2015 was 1,048,000 units. Exchange. MMC’s net sales and net income for fiscal year 2015 were 2,267.8 billion yen and 89.1 billion yen respectively. MMC is listed on the Tokyo Stock. Exchange.