Nissan officially announced today that it will acquire a controlling 34 per cent stake of Mitsubishi Motors for the price of $2,2 billion.
This will make Nissan Mitsubishi’s single largest shareholder, forming a strategic alliance between the two Japanese automakers.
The new deal will see the two companies working together in the areas of purchasing, common vehicle platforms, technology-sharing, joint plant utilization and growth markets.
“This is a breakthrough transaction and a win-win for both Nissan and Mitsubishi Motors”, said Carlos Ghosn, chief executive and president of Nissan. “It creates a dynamic new force in the automotive industry that will cooperate intensively, and generate sizeable synergies. We will support MMC as they address their challenges and welcome them as the newest member of our enlarged Alliance family.”
“Through its long history of successful partnerships Nissan Motor has developed a deep knowledge of maximizing the benefits from alliance partnerships”, said Osamu Masuko, chairman of the board and chief executive of Mitsubishi Motors. “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.”
The agreement is expected to be signed by May 25 which will give Nissan the power not only to appoint four directors to the Mitsubishi’s board but also decide who is going to be the brand’s next chairman.
Nissan essentially saved Mitsubishi after calling them out for cheating on the fuel economy figures of some of its JDM models which in turn caused a huge crisis for their now partner. This also allowed Nissan to purchase Mitsubishi’s controlling stake at almost half of its pre-crisis value according to some experts, with the latter getting some much-needed cash injection to deal with the fuel economy scandal.
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