Nissan has taken a 34% stake in scandal-hit Mitsubishi for NZ$3.1bn.
The purchase makes Nissan the largest shareholder in Mitsubishi, and puts it over the one-third ownership threshold that Japanese corporate law uses to define a takeover.
Mitsubishi’s value has been in freefall since it admitted to manipulating fuel economy data in several minicars – two of which were rebadged as Nissans for sale in Japan. It was Nissan’s own tests that revealed the fuel usage fraud.
As news of the scandal broke, Nissan was reportedly already in compensation talks with Mitsubishi Motors.
After a meeting in Nissan’s home city Yokohama yesterday (local time) a hastily-assembled joint press conference saw Nissan chief Carlos Ghosn and Mitsubishi chairman Osamu Masuko appear to announce the takeover.
The deal sees Nissan become Mitsubishi’s top investor. Mitsubishi group companies ” Mitsubishi Heavy Industries, trading company Mitsubishi Corp. and the Bank of Tokyo-Mitsubishi UFJ ” will continue to hold stakes in Mitsubishi Motors, but under terms of the agreement will support the Nissan alliance.
Ghosn said that it was a “win-win” deal that would ape the success of the Nissan-Renault alliance.
“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,” said the Brazilian-born Frenchman,n that put together the Nissan-Renault deal in 1999.
Ghosn said the companies would share platorms, purchasing power and technology.
Responding to a question from Associated Press journalists, he shrugged off the risks of a partnership with a company prone to fraud, saying he trusted Masuko.
“Obviously the problem is very serious, we don’t take it lightly. At the same time there are solutions, not only to respond to this problem but also to avoid these kinds of problems,” Ghosn told AP.
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