Nissan & Renault to buy 20% of GM

[smainville]

What if?

http://edition.cnn.com/2006/BUSINESS/06/30/gm.reut/index.html

[Turbo Bob]

If I was a shareholder in Nissan or Renault, I'd be annoyed they were using my money to invest in junk stock...

[G0dspd]

I'm wondering if this is a real possibility or something the media as blown out of proportion when they heard about the billionaire's letter.  There's been a lot of buzz around this event in the last few days ... so MAYBE it's not crazy talk after all. 

It won't be the next Daimler-Chrysler that's for sure.  It would be interesting to see what becomes of this partnership. 

[safristi]

Kerkorian is what 115  ?..... a THREE WAY would dicker his TICKER............maybe he wants to go out in the NEW CAMARO wif an F1 RENAULT engine in it and that cute little clock from NISSAN/ ...INFINITI and beyond OLDE_WAN KON ALL THE SHAREHOLDERS......

[dougjp]

Its probably not the case, however I couldn't help thinking, maybe its Kerkorian's own shares that he's trying to unload on Renault. Or, another way, how much share value did he gain by creating this news/discussion? GM shares went up on the news/rumours.....

[smainville]

Hey Barrie what do you think of a GMNR possibility?

[Snowman]

”If” this happens it will trigger more M&A madness.

[safristi]

M'seur Barrie holds that all communicadoes be from threw heez agencies SVP en FRANCE.....

[Wolfe]

Well, GM had to pay about $2 billion after signing an alliance deal with Fiat just to make Fiat go away and forget about it.

Maybe GM should hope for Renault/Nissan to do the same to make GM go away. Of course GM would have to hope that R/N is as big a sucker as ...um ... GM.

[smainville]

”If” this happens it will trigger more M&A madness.

I can see Toyota taking over Mitsu, actually that's been talked about a while back.

[si]

sorry if this is a repost

http://www.chron.com/disp/story.mpl/ap/fn/4017371.html

July 1, 2006, 5:48AM
Report: Nissan, Renault Mull GM Investment


© 2006 The Associated Press

TOKYO — Automakers Nissan Motor Co. and Renault SA are considering buying up to 20 percent of outstanding shares in General Motors Corp., Kyodo News agency reported Saturday.

Details of the possible investment plan surfaced after billionaire investor Kirk Kerkorian proposed on Friday that GM join the Nissan-Renault alliance, Kyodo said.

The report did not say how much the investment would cost.

If it materializes, the deal will create a huge auto alliance with annual output exceeding 15 million vehicles and commanding nearly one-quarter of global market share, Kyodo said.

Nissan officials were not available for comment Saturday.

Kerkorian's company, Tracinda Corp., a large minority shareholder in the U.S. automaker, told GM Chairman and Chief Executive Rick Wagoner in a letter Friday that the French and Japanese companies are receptive to the idea of including GM in their partnership, and in purchasing "a significant minority interest" in the automaker, the company said Friday.

In a statement Friday, GM said the Tracinda request "will be taken under advisement" by its board of directors. The automaker said it has not received any offers or proposals from Renault/Nissan about an alliance.

Nissan said in a statement that Chairman Carlos Ghosn had been approached by Tracinda "to assess the merits of GM joining the Renault Nissan Alliance."

"At this point, it is necessary that the GM Board and top management fully support this project in order to start the study of this opportunity after agreement of Renault and Nissan boards," Nissan said, adding that its alliance with Renault was an "open partnership" and "under the right circumstances and with the appropriate partners ... could be expanded further."

When Kerkorian approached Ghosn last month, the Nissan chief showed interest in purchasing up to 10 percent in GM, with Renault buying the other 10 percent stake, according Japanese business daily Nihon Keizai.

GM has been engaged in an extensive turnaround plan in North America amid declining profits, high labor costs and growing competition from Asian automakers. The automaker announced plans last year to close 12 plants by 2008 and earlier this week said 35,000 hourly workers had agreed to retire early or accept a buyout offer.

Tracinda owns 9.9 percent of GM's common stock and is GM's third-largest shareholder.

Renault owns a 44.4 percent stake in Nissan, which in turn owns a 15 percent stake in Renault. Nissan was on the brink of bankruptcy when Ghosn was dispatched by Renault to lead the Japanese company in 1999.

[JSCC]

sorry if this is a repost

http://www.chron.com/disp/story.mpl/ap/fn/4017371.html

July 1, 2006, 5:48AM
Report: Nissan, Renault Mull GM Investment


© 2006 The Associated Press

TOKYO — Automakers Nissan Motor Co. and Renault SA are considering buying up to 20 percent of outstanding shares in General Motors Corp., Kyodo News agency reported Saturday.

Details of the possible investment plan surfaced after billionaire investor Kirk Kerkorian proposed on Friday that GM join the Nissan-Renault alliance, Kyodo said.

The report did not say how much the investment would cost.

If it materializes, the deal will create a huge auto alliance with annual output exceeding 15 million vehicles and commanding nearly one-quarter of global market share, Kyodo said.

Nissan officials were not available for comment Saturday.

Kerkorian's company, Tracinda Corp., a large minority shareholder in the U.S. automaker, told GM Chairman and Chief Executive Rick Wagoner in a letter Friday that the French and Japanese companies are receptive to the idea of including GM in their partnership, and in purchasing "a significant minority interest" in the automaker, the company said Friday.

In a statement Friday, GM said the Tracinda request "will be taken under advisement" by its board of directors. The automaker said it has not received any offers or proposals from Renault/Nissan about an alliance.

Nissan said in a statement that Chairman Carlos Ghosn had been approached by Tracinda "to assess the merits of GM joining the Renault Nissan Alliance."

"At this point, it is necessary that the GM Board and top management fully support this project in order to start the study of this opportunity after agreement of Renault and Nissan boards," Nissan said, adding that its alliance with Renault was an "open partnership" and "under the right circumstances and with the appropriate partners ... could be expanded further."

When Kerkorian approached Ghosn last month, the Nissan chief showed interest in purchasing up to 10 percent in GM, with Renault buying the other 10 percent stake, according Japanese business daily Nihon Keizai.

GM has been engaged in an extensive turnaround plan in North America amid declining profits, high labor costs and growing competition from Asian automakers. The automaker announced plans last year to close 12 plants by 2008 and earlier this week said 35,000 hourly workers had agreed to retire early or accept a buyout offer.

Tracinda owns 9.9 percent of GM's common stock and is GM's third-largest shareholder.

Renault owns a 44.4 percent stake in Nissan, which in turn owns a 15 percent stake in Renault. Nissan was on the brink of bankruptcy when Ghosn was dispatched by Renault to lead the Japanese company in 1999.

Making an investment to lose money.... hmmm. 
Sure go ahead. 

The auto industry is full of surprises!

[kelli]

i..er.. but..

oh dear..

[G0dspd]

I've always suspected that all the automotive brands of the world would eventually boil down to a few giants.  For example, the Ford group, DC, VW/Skoda/Lambo ... etc.  They"re all linked together in some way ... so this is just one of many mergers to come.

GM is not a healthy company but they're improving.    I don't know if a relation with Nissan/Renault will help their efforts but if they get Ghosn's magic touch ... who knows?    A Japanese/European/Amrerican group ... interesting concept! 

If it materializes, the deal will create a huge auto alliance with annual output exceeding 15 million vehicles and commanding nearly one-quarter of global market share, Kyodo said.

Maybe it's GM's big plan to stay #1 and resist Toyota! 

[articsteve]

At least all three would merger with the same standard of quality. 

[a4_tom]

If, a very big IF. Renault/Nissan is going to buy GM shares. What are they going to do with brands that cannabalizing themselves? Are they going to escalate to killing more GM brands, if R/N wants GM to survive? Is this Ghosen's attempt to overtake Toyota by this "merger"?

One thing for sure. This story has been the most talkable auto/finanical topic in this Canada/US long weekend in every forums I go to!

[G0dspd]

A good reason for GM to finally clean the house of its obsolete models (clones) and brands (Buick ... nice try but time to die)  What's gonna happen to SAAB, Vauxhall, etc. 

One thing for sure. This story has been the most talkable auto/finanical topic in this Canada/US long weekend in every forums I go to!

I agree!  There's been a lot of buzz around these "rumours" or talks ... so I wouldn't be surpised if it actually happens.

[mdxtasy]

I think it's not a half bad idea.  Stocks are low and staying there unless something drastic changes.  The company is losing money but the progress GM has made in shedding some overhead and underutilized plants might be a small sliver of hope in recovering.  It's a big gamble...but the ducks might line up for some big returns.  Get some fresh insight, new direction and products....the ship might actually turn.

[gta_driver]

These are my thoughts on it.

The alliance is of great advantage to Kerkorian. In an interview last year Ghosn did indirectly say that GM should lose brands in its restructuring and use chapter 11 to its full advantage. For GM, it gives them an infusion of cash which they desperatly need ($3 million).  I'm sure any monies that GM gets will be tied to controling the direction of GM takes in terms of restructuring. Tracienda's(Kerkorians company) existing 9.9% stake in GM and a possible 20% stake by Nissan-Renault will give the Kerkorian-Nissan-Renault alliance basically a 30% share in all of GM, which is enough to influence what decisions are made at GM.

Secondly, for anyone who reads any of the European business papers or car magazines, its no secret that Carlos has been actively trying to purchase either Saab or Volvo in the past 6 months. He's been rejected by Ford(Volvo) and GM is hestitant to get rid of Saab, now that its finally returning profits in Europe. Nissan-Renault  has actively been looking for a premium European brand. The thought is that it will take too much time and $$$ for Infiniti to establish a luxury brand footprint in Europe. Toyota's Lexus is currently struggling badly in terms of sales against the established European premium brands.

I wouldn't be suprised that there is a side deal made with GM, that whether or not GM's restructuring works, Nissan-Renault walks away with Saab. Which is good for Saab.

[a4_tom]

Renault should handle quirky European brand called Saab much better than GM, cause they already are.