French government, Fiat Chrysler blame each other for failed Renault bid
The French government on Thursday dismissed allegations by Fiat Chrysler that political interference was to blame for a failed tie-up with French carmaker Renault.
“The reason why this deal didnt happen was to ensure the alliance with Nissan was preserved. It has nothing to do with the French state stake [in Renault] or political decisions,” a government official told reporters.
The official denied that the collapse of merger talks had anything to do with conditions posed by the French government on keeping jobs and operations in France. The Fiat Chrysler (FCA) board decided Thursday to pull out of its €33 billion merger proposal with the Renault group, blaming “the political conditions in France.”
Fiat Chryslers move came after Renaults board delayed a decision on whether to engage with the merger proposal at a meeting Wednesday evening. The French government is Renaults largest shareholder, with a 15 percent stake in the carmaker.
“The [French] State wanted the board to have an additional 5-day delay to secure the support of all stakeholders involved,” the French finance ministry said in press release.
Renault has a long-standing relationship with Japanese carmaker Nissan, but ties between the two automakers have frayed after Japanese authorities arrested Carlos Ghosn, the former CEO of Renault and chairman of Nissan, last year on charges of financial wrongdoing.
In a statement, the FCA board said that while it “remains firmly convinced of the compelling, transformational rationale” of the 50-50 merger proposal, “it has since become clear that the political conditions in France do not currently exist for such a combination to proceed successfully.”
Meanwhile, Renault said in a statement that its board is not in a position to green-light the merger talks because of “the request by the French government to postpone the decision to another board meeting.”
A Fiat official said: “The French government tried to impose conditions that we very simply could not meet.”
The Fiat official said the French sought to delay the merger for the second time after a six-hour late-night board meeting on Wednesday because Paris wanted further reassurances on “a seat on the board of the new company for the French state, operative headquarters in France and French jobs preservation.”
Deputy Prime Minister Luigi Di Maio, from the populist 5Stars Movement, told an Italian radio show: “The FCA-Renault case shows its not alwaRead More – Source