FCA Abruptly Withdraws Massive Merger Proposal With Renault

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Thread: FCA Abruptly Withdraws Massive Merger Proposal With Renault

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    FCA Abruptly Withdraws Massive Merger Proposal With Renault

    FCA Abruptly Withdraws Massive Merger Proposal With Renault

    By Brad Anderson
    June 5, 2019

    carscoops.com

    Fiat Chrysler Automobiles has abruptly and unexpectedly withdrawn its offer to merge with Renault following days of discussions between the automakers and the French government.

    A press release statement issued late on Wednesday evening stated “that the political conditions in France do not currently exist for such a combination to proceed successfully.” The Wall Street Journal claims that’s not the only reason why the proposal has been withdrawn.

    According to unnamed sources close to the matter, negotiations soured as Nissan refused to back the merger. Two representatives from Nissan on the Renault board offered abstentions while voting on the merger and it’s believed that both FCA and Renault were concerned the Japanese car manufacturer would back out of its long-standing alliance with Renault.

    The New York Times reports that Renault chairman Jean-Dominique Senard had been seeking to convince the company’s board of the financial and industrial merits of a deal during two days of intense meetings at Renault’s headquarters this week. Earlier on Wednesday, Renault said it had been unable to make a decision because French government representatives requested to postpone a new vote.

    Evidently, FCA did not want to wait around and confirmed that the proposal made official on May 26 was no longer on the table.

    “The Board of Fiat Chrysler Automobiles N.V, meeting this evening under the Chairmanship of John Elkann, has resolved to withdraw with immediate effect its merger proposal made to Groupe Renault…FCA will continue to deliver on its commitments through the implementation of its independent strategy,” the company said.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    The French government might be a problem? And Nissan, jailer of their former Maximum Leader, is uncooperative?

    You want to link up with or make a deal with two highly dysfunctional entities, what could possibly go wrong here?
    Last edited by Neanderthal; 06-05-2019 at 07:28 PM.
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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    Come what may, It is going to be interesting to see what comes next.

    Whomever that involves.
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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    I'm wondering if FCA did this just to drive a further wedge between Renault and Nissan.

    According to the story, Renault was all for the merger, but Nissan was resisting a deal. Now that FCA backed away, Renault executives will surely be angry with Nissan, which is only making a frosty relationship even worse. If Nissan and Renault end up making a formal split, FCA can always go back to Renault.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    Sounds like time for Renault to drop Nissan and replace it with FCA.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    France government is trying too hard to get in the middle and it is costs them this deal. Idiots.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    The United States should get involved to protect Americans

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    FCA's official press release:

    The Board of Fiat Chrysler Automobiles N.V. (“FCA”) (NYSE: FCAU / MTA: FCA), meeting this evening under the Chairmanship of John Elkann, has resolved to withdraw with immediate effect its merger proposal made to Groupe Renault.

    FCA remains firmly convinced of the compelling, transformational rationale of a proposal that has been widely appreciated since it was submitted, the structure and terms of which were carefully balanced to deliver substantial benefits to all parties. However it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully.

    FCA expresses its sincere thanks to Groupe Renault, in particular to its Chairman and its Chief Executive Officer, and also to the Alliance partners at Nissan Motor Company and Mitsubishi Motors Corporation, for their constructive engagement on all aspects of FCA’s proposal.

    FCA will continue to deliver on its commitments through the implementation of its independent strategy.
    In my personal opinion...whew! FCA dodged a bullet there.
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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    bloomberg radio made it sound like the FRENCH GOVERNMENT was NOT allowing a 50/50 split and was insisting that renault / the french have controlling interest
    I get the impression that NISSAN is NOT happy with FCA as the other 49% power will be split between NISSAN and FCA and the Renault / French keeping 51% meaning NISSAN will get steamrolled by the French and end up paying / HAVING to USE french facturies and NOT better and CHEAPER Japanese / Thailand ones

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    Quote Originally Posted by bballr4567 View Post
    France government is trying too hard to get in the middle and it is costs them this deal. Idiots.
    Government interference is the root of a lot of problems. Same in the U.S. these days.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    This won't bode well for FCA. Renault had the expertise in compact and midsize cars that FCA needs. FCA should go around Renault and go straight to Nissan.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    To be fair, both Italy and France were looking for guarantees of no job losses or plant closures.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    Quote Originally Posted by dannyg View Post
    To be fair, both Italy and France were looking for guarantees of no job losses or plant closures.

    https://www.autoblog.com/2019/05/30/...-italy-france/
    Renault has been a featherbed and get-the-relatives'-kids-jobs outfit since the '50s from what I've read. Maybe that's a source of some of their problems. That and the gummit sticking their nose in.
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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    Quote Originally Posted by kool1 View Post
    Government interference is the root of a lot of problems. Same in the U.S. these days.
    It wasn't government interference but the actual government stability. France is a freaking hot bed of issues right now and a lot of Frenchman are getting destroyed with taxes that they feel dont represent the value of the regular person in France.

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    Re: FCA Abruptly Withdraws Massive Merger Proposal With Renault

    It would be in the best interest of the French Govt (longterm) to get this deal done. I see this as mutually beneficial between Renault and Fiatsler, as they are strong not only in different segments, but also markets - there is a lot of synergy there.
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