Nissan buys out part of Mitsubishi
05-12-16, 05:20 AM
#1
Lexus Fanatic
Thread Starter
Nissan buys out part of Mitsubishi
Well, this just might extend Mitsubishi's rapidly-shrinking presence here a little in the American market, but I'll still be surprised if Mitsubishi really stays here that much longer. Their dealer network here is down to almost nothing compared to major brands.
Seems to me, though, that, as Nissan/Infiniti's owner, the money for the Mitsubishi buyout is really coming from Renault, not Nissan.
https://www.washingtonpost.com/busi....869_story.html
Nissan Motor Co. is taking a 34 percent stake in scandal-ridden Mitsubishi Motors Corp. in what Nissan Chief Carlos Ghosn said was “a win-win” deal.
Ghosn appeared with Mitsubishi Motors Chairman Osamu Masuko in a hastily called joint conference Thursday in Yokohama, where Nissan is headquartered.
Ghosn said Nissan will invest 237 billion yen ($2.2 billion) to become the top investor in Mitsubishi Motors.
Masuko said Mitsubishi group companies will continue to hold stakes in the automaker.
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Mitsubishi Motors has been recently rocked by a scandal over cheating on mileage tests to inflate mileage for minicar models.
Masuko apologized for the scandal but welcomed the alliance with Nissan.
Ghosn, who engineered Nissan’s alliance with Renault, said adding Mitsubishi will be a plus in sharing platforms, purchasing and technology.
Seems to me, though, that, as Nissan/Infiniti's owner, the money for the Mitsubishi buyout is really coming from Renault, not Nissan.
https://www.washingtonpost.com/busi....869_story.html
Nissan Motor Co. is taking a 34 percent stake in scandal-ridden Mitsubishi Motors Corp. in what Nissan Chief Carlos Ghosn said was “a win-win” deal.
Ghosn appeared with Mitsubishi Motors Chairman Osamu Masuko in a hastily called joint conference Thursday in Yokohama, where Nissan is headquartered.
Ghosn said Nissan will invest 237 billion yen ($2.2 billion) to become the top investor in Mitsubishi Motors.
Masuko said Mitsubishi group companies will continue to hold stakes in the automaker.
Innovations newsletter
Cutting-edge developments in tech and elsewhere.
Mitsubishi Motors has been recently rocked by a scandal over cheating on mileage tests to inflate mileage for minicar models.
Masuko apologized for the scandal but welcomed the alliance with Nissan.
Ghosn, who engineered Nissan’s alliance with Renault, said adding Mitsubishi will be a plus in sharing platforms, purchasing and technology.
05-12-16, 09:25 AM
#2
Lexus Champion
Nissan Motor Co has agreed to buy a 34 per cent stake in Mitsubishi Motors Corp , taking de facto control with a $2.2-billion bet that bails out its smaller, scandal-hit rival.
The deal is a lifeline for Mitsubishi Motors, which is mired in its third scandal in two decades and has had $3-billion wiped off its market value after confessing to manipulating fuel economy data.
But it should also be a boost for Nissan. Japan’s second-largest car maker has struggled to make inroads into Southeast Asia, in countries like Thailand and the Philippines, where Mitsubishi’s models are popular.
Mitsubishi and Nissan already co-operate on development and manufacturing with a partnership dating back to 2011, but that deal does not currently involve any cross-shareholding.
Under Thursday’s deal, Mitsubishi Motors will issue new shares to Nissan at a 5.3 per cent discount to Wednesday’s close, raising 237.4 billion yen ($2.18-billion).
That will hand Nissan just over a third of the group – enough to wield control, under Japanese shareholding rules.
...
Nissan will be able to nominate a third of Mitsubishi Motors’ board, which Ghosn said he believed would be led by a Nissan executive – prompting industry analysts and bankers to forecast a significant reshuffle at the top.
...
Ghosn said improving performance in kei cars, a Japanese category of small cars, was one key reason for the deal. Indeed, Nissan will gain a leg up in Japan’s small car market, where it is dwarfed by Suzuki and Toyota’s Daihatsu.
It will also get a lift in fast-growing Asian economies, where Mitsubishi is more readily recognized. Asia excluding China accounted for just 6.5 per cent of Nissan’s global retail sales in the year to the end of March.
“The biggest benefit to Nissan would be Mitsubishi’s presence in Southeast Asia,” said Koji Endo, autos analyst at Advanced Research Japan.
But the deal also leaves Nissan with a much tougher task: ensuring a turnaround at Mitsubishi, without full control.
“Taking a one-third stake feels a bit like a half-measure,” said Kiyoshi Yamanaka at T&D Asset Management.
“For investors, it would be cleaner if they made Mitsubishi Motors a fully owned subsidiary, as Toyota did with Daihatsu, and then took firm control of righting its governance.”
An industry banker familiar with the deal dampened expectations of a full takeover. Sister companies in the sprawling Mitsubishi family are unlikely to sell, he said.
Mitsubishi Heavy Industries Ltd, Mitsubishi Corp , and the Bank of Tokyo-Mitsubishi UFJ, together with subsidiaries held roughly a 34 per cent stake in the auto maker before the deal. That will be diluted to around 22 per cent.
...
Alliance partner Renault, Nissan and Mitsubishi have combined sales of about 9.3 million vehicles, approaching those of industry leaders Toyota and Volkswagen AG.
“We have the potential to be in top three,” Ghosn said.
The deal is a lifeline for Mitsubishi Motors, which is mired in its third scandal in two decades and has had $3-billion wiped off its market value after confessing to manipulating fuel economy data.
But it should also be a boost for Nissan. Japan’s second-largest car maker has struggled to make inroads into Southeast Asia, in countries like Thailand and the Philippines, where Mitsubishi’s models are popular.
Mitsubishi and Nissan already co-operate on development and manufacturing with a partnership dating back to 2011, but that deal does not currently involve any cross-shareholding.
Under Thursday’s deal, Mitsubishi Motors will issue new shares to Nissan at a 5.3 per cent discount to Wednesday’s close, raising 237.4 billion yen ($2.18-billion).
That will hand Nissan just over a third of the group – enough to wield control, under Japanese shareholding rules.
...
Nissan will be able to nominate a third of Mitsubishi Motors’ board, which Ghosn said he believed would be led by a Nissan executive – prompting industry analysts and bankers to forecast a significant reshuffle at the top.
...
Ghosn said improving performance in kei cars, a Japanese category of small cars, was one key reason for the deal. Indeed, Nissan will gain a leg up in Japan’s small car market, where it is dwarfed by Suzuki and Toyota’s Daihatsu.
It will also get a lift in fast-growing Asian economies, where Mitsubishi is more readily recognized. Asia excluding China accounted for just 6.5 per cent of Nissan’s global retail sales in the year to the end of March.
“The biggest benefit to Nissan would be Mitsubishi’s presence in Southeast Asia,” said Koji Endo, autos analyst at Advanced Research Japan.
But the deal also leaves Nissan with a much tougher task: ensuring a turnaround at Mitsubishi, without full control.
“Taking a one-third stake feels a bit like a half-measure,” said Kiyoshi Yamanaka at T&D Asset Management.
“For investors, it would be cleaner if they made Mitsubishi Motors a fully owned subsidiary, as Toyota did with Daihatsu, and then took firm control of righting its governance.”
An industry banker familiar with the deal dampened expectations of a full takeover. Sister companies in the sprawling Mitsubishi family are unlikely to sell, he said.
Mitsubishi Heavy Industries Ltd, Mitsubishi Corp , and the Bank of Tokyo-Mitsubishi UFJ, together with subsidiaries held roughly a 34 per cent stake in the auto maker before the deal. That will be diluted to around 22 per cent.
...
Alliance partner Renault, Nissan and Mitsubishi have combined sales of about 9.3 million vehicles, approaching those of industry leaders Toyota and Volkswagen AG.
“We have the potential to be in top three,” Ghosn said.
The Mitsubishi group of companies loses control but still retains shares in the automaker (going from a 34% controlliing stake to a minority 22% stake). Under Japanese laws, a one-third stake is enough to give effective control of a company. This is how Ford gained control of Mazda, with only a 34% stake.
Interesting that the purchase of Mitsubishi Motors may get Renault-Nissan-Mitsubishi into the top 3 automakers (currently Toyota, GM and VW) vaulting ahead of Hyundai-Kia.
I doubt that we will see much change to Mitsubishi's presence here in North America; but Nissan will gain in Southeast Asia (at least in the poorer countries such as Thailand and Philippines), where it has relatively small market share, due to it not having small kei cars in its lineup.
05-12-16, 10:26 AM
#3
Lead Lap
Renault has a ~43% percent stake in Nissan and Nissan has a 15 percent stake in Renault. Renault is in control here since Nissan doesn't have a voting rights. They are still 2 separate companies, despite this.
05-12-16, 01:20 PM
#4
Lexus Fanatic
Thread Starter
I see you're not familiar with how the Renault-Nissan alliance is structured. Renault is not the owner of Nissan. They have a cross-shareholding agreement. ['quote]
Renault has a ~43% percent stake in Nissan and Nissan has a 15 percent stake in Renault. Renault is in control here since Nissan doesn't have a voting rights. They are still 2 separate companies, despite this.
Renault has a ~43% percent stake in Nissan and Nissan has a 15 percent stake in Renault. Renault is in control here since Nissan doesn't have a voting rights. They are still 2 separate companies, despite this.
05-12-16, 08:08 PM
#6
Lead Lap
Well then I'm not exactly sure why you made that comment in your original post.
05-12-16, 08:10 PM
#7
This most likely means nothing for Mitsubishi getting a revival in the United States. I expect they'll be done here in 2 years, if not sooner. The company has made some neat turbocharged rocket ships over the years(90's Eclipse, 3000GT VR-4, and the Lancer Evolution), but honestly their quality sucked and their mainstream cars could not have been more boring and dull.
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05-13-16, 03:48 PM
#8
Lexus Fanatic
Thread Starter
Because from what i can tell, it still is part of Renault's money either way. But, in the long run, how much comes from Renault and how much from Nissan probably doesn't matter.......for our purposes, either Mitsubishi survives here in he U.S. or it doesn't. Its dealership-network is getting so thin that it's getting more and more difficult to even look at one, much less purchase one...as is the fact that only a few specific vehicle-models are even still on sale in the U.S.
05-13-16, 08:06 PM
#9
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Mitsubishi has gotten so bad that they come across as a Chinese brand trying to sell cars in the US. I don't even understand how they could let themselves go down the tubes so badly. Of course it's about money but the sad result is less and less capital since they can't sell cars. The only way to more capital in this business (and most) is to invest in building cars as good as everyone else's.
05-13-16, 08:53 PM
#10
Mitsubishi has gotten so bad that they come across as a Chinese brand trying to sell cars in the US. I don't even understand how they could let themselves go down the tubes so badly. Of course it's about money but the sad result is less and less capital since they can't sell cars. The only way to more capital in this business (and most) is to invest in building cars as good as everyone else's.
Mitsubishi has never been able to get back to its former glory, whether it was in their sports cars, MPV's, compacts like the Colt, their motorsport rally pedigree, or making enthusiasts gush over the Evo.
Mitsubishi has been tinkering with EV and PHEV the last few years, giving us the dreaded little i-MiEV. The 2017 Outlander PHEV looks decent, but the lack of a network or advertising will not help its cause.
The 2017 Pajero Sport is kind of cool but we don't get that here.
Would be cool to see Nissan and Mitsubishi collaborate on a pair of sports cars, maybe one to replace the aged Z and another to use a former Mitsubishi sports car moniker.
05-13-16, 09:42 PM
#11
Lexus Fanatic
Thread Starter
I don't see how it would do Mitsubishi much, if any, good to get into a relatively slow-selling sports car if it no longer has the product-lineup to sell even mainstream products (although a few more Mitsubishi products are offered, little else beside the Outlander Sport actually sells now in the U.S.). And, of course, a company can't sell without dealerships.......the American-market Mitsubishi dealership network has been getting more sparse than a politician who doesn't lie.
05-14-16, 10:43 AM
#12
I don't see how it would do Mitsubishi much, if any, good to get into a relatively slow-selling sports car if it no longer has the product-lineup to sell even mainstream products (although a few more Mitsubishi products are offered, little else beside the Outlander Sport actually sells now in the U.S.). And, of course, a company can't sell without dealerships.......the American-market Mitsubishi dealership network has been getting more sparse than a politician who doesn't lie.
05-14-16, 05:29 PM
#13
Lexus Fanatic
I don't see how it would do Mitsubishi much, if any, good to get into a relatively slow-selling sports car if it no longer has the product-lineup to sell even mainstream products (although a few more Mitsubishi products are offered, little else beside the Outlander Sport actually sells now in the U.S.). And, of course, a company can't sell without dealerships.......the American-market Mitsubishi dealership network has been getting more sparse than a politician who doesn't lie.
Sports/sporty cars is what they became known for and what saved them in the 90's from fading into oblivion like they have done know. If they would have focused on sports cars/sporty cars again it would have created some buzz and generated sales and interest, I don't know if it is too late for them now though. Nissan has a rwd platform, wonder if Mitsubishi do some sports cars/sport sedans off of it with this deal.
05-14-16, 05:39 PM
#14
Lexus Test Driver
potential conversation between nissan and mitsou exec:
NE: you know that stunt you pulled with the emissions and gas mileage numbers is going to cost you?
ME: what are we talking about, what numbers are we looking at?
NE: xxx Yens
ME: WHAT??? for that you could just buy us out.
NE: Done, we'll have our lawyers call yours.
LOL
NE: you know that stunt you pulled with the emissions and gas mileage numbers is going to cost you?
ME: what are we talking about, what numbers are we looking at?
NE: xxx Yens
ME: WHAT??? for that you could just buy us out.
NE: Done, we'll have our lawyers call yours.
LOL
05-14-16, 07:11 PM
#15
Lexus Champion
Mitsubishi has gotten so bad that they come across as a Chinese brand trying to sell cars in the US. I don't even understand how they could let themselves go down the tubes so badly. Of course it's about money but the sad result is less and less capital since they can't sell cars. The only way to more capital in this business (and most) is to invest in building cars as good as everyone else's.
Do you think this crowd is interested in paying back their loans?
Hip commercial, wrong audience.Last edited by dseag2; 05-14-16 at 07:21 PM.