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Future of Renault-Nissan-Mitsubishi Alliance Uncertain Amid CEO Arrest

21 November, 2018, 17:42 | Author: Sara Gill
  • Nissan has accused Ghosn of under-reporting his salary over a period of several years and 'numerous significant acts of misconduct'. — Reuters pic

Japanese prosecutors raided Nissan's global headquarters in Yokahama after Mr Ghosn's arrest, seeking evidence.

Asked about reports that Nissan and Renault had been on the verge of merging, Nissan's CEO Hiroto Saikawa told reporters Wednesday that he had not heard of such a plan.

Both Kelly and Ghosn were arrested in Japan on Monday.

At Nissan, Ghosn had the authority to decide the remuneration packages of directors.

While both Le Maire and his Japanese counterpart, Hiroshige Seko, reaffirmed their support for the alliance, the structure of the partnership between the two companies has been increasingly controversial in Japan as Nissan outgrows Renault in sales and profits.

He's one of the most senior figures in the vehicle industry and he's now under arrest.

Japanese prosecutors said they were holding Ghosn, 64, for allegedly collaborating to falsify securities statements and underreporting $44.6 million in income from 2011 to 2015.


Nissan's board was due to meet Thursday to consider dismissing Ghosn from his role as chairman. Mitsubishi CEO Osamu Masuko said Tuesday that he did not think "there is anyone else on Earth like Ghosn who could run Renault, Nissan and Mitsubishi".

"Ghosn is likely the most successful foreign chairman in Japan", said Kosuke Sato, a senior economist at the Japan Research Institute.

Through complex cross-shareholding arrangements, Renault owns 43 percent in Nissan, including voting rights, while Nissan owns a 15 percent non-voting stake in Renault.

Public broadcaster NHK reported that Nissan had paid "huge sums" to provide Ghosn with luxury homes in Rio de Janeiro, Beirut, Paris and Amsterdam "without any legitimate business reason".

Even when his reputation was sky-high, he attracted criticism for a flashy lifestyle at odds with traditional Japanese corporate culture and over his salary - an estimated €13 million in total past year.

The charismatic industry figure, who brought Nissan back from the brink of bankruptcy in the late 1990s, is also suspected of having used residences in Brazil, France, Lebanon and the Netherlands, purchased by the subsidiary and other entities, without paying rent or reporting that benefit as part of his compensation.

The Yomiuri Shimbun on Tuesday quoted Nissan executives slamming Ghosn as "greedy".

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