Nissan Motor Company has recently announced its plans to sell 149,028,300 shares in its affiliated automaker, Mitsubishi Motors Corporation (MMC). This move is part of a broader restructuring strategy aimed at reducing costs and increasing cashflow. MMC is a key part of Nissan’s Alliance partnership, which also includes Renault SA of France.
The share sale, equivalent to approximately a 10.02% stake, is expected to take place at Thursday’s closing price of 460.6 yen through the Tokyo Stock Exchange’s off-floor trading platform. This transaction will reduce Nissan’s shareholding in MMC to around 34.07% or 506,620,577 shares.
In a statement, Nissan mentioned that the share sale will support MMC’s management strategy and enhance Nissan’s financial flexibility, paving the way for future growth opportunities. Despite the share sale, both companies will continue their collaborative efforts to drive innovation and deliver exceptional value to their stakeholders. Together, the Alliance companies are actively engaged in high-value creation projects that respond to evolving industry trends.
This decision comes as Nissan reported a 79.1 billion yen fall in consolidated net revenue to 5.98 trillion yen in the first half of the year. Operating profits also saw a significant decline, plunging by 303.8 billion yen to 32.9 billion yen, resulting in an operating profit margin of just 0.5%. To address these challenges, the company announced plans to reduce its global production capacity by 20% and make 9,000 redundancies worldwide to cut costs.
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Overall, Nissan’s decision to sell shares in MMC reflects a strategic move towards financial restructuring and cost-cutting measures. Despite the challenges faced by the automotive industry, the Alliance companies remain committed to driving innovation and creating value for their stakeholders.
