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FCA Blames French State for Failed Renault Merger

Fiat Chrysler has backed out of a proposed merger with Renault, blaming ‘political conditions’ in France, whose government owns a 15% share of Renault. A week ago, the companies were poised to form the world’s third-largest automaker.

Tariq Kamal
Tariq KamalFormer Associate Publisher
Read Tariq's Posts
June 6, 2019
FCA Blames French State for Failed Renault Merger

A team led by French finance minister Bruno Le Maire was reportedly unable to win Nissan’s support for a merger between its factory alliance partner, France’s Renault, and the Italian-American Fiat Chrysler.

Photo by Thomas Bresson via Wikimedia Commons

1 min to read


(Bobit) — Fiat Chrysler Automobiles and its chairman, John Elkann, have pulled a $35 billion offer to merge with Groupe Renault. First made public last week, the proposal, if consummated, would have formed the world’s third-largest automaker.

Sources say talks fell apart Wednesday night after French finance minister Bruno Le Maire requested a six-day postponement of a vote among representatives of FCA, Renault, Renault’s alliance partner, Nissan, and the French government, which owns 15% of Renault.

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After Nissan’s representatives abstained from voting, reports suggest, Le Maire held the French state’s vote and asked for more time to seek the endorsement of his Japanese counterparts. Elkann declined.

Renault executives pledged to continue to study the proposal. In a statement, FCA’s directors expressed gratitude to all involved parties but offered little indication the talks would continue anytime soon.

“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,” the statement reads, in part. “However, it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully.”

Originally posted on Auto Dealer Today

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