On the evening of May 12, Nissan Motor and Mitsubishi Motors jointly issued a statement saying that the former will spend 237 billion yen to acquire the 34% stake in the latter and obtain a seat on the board of directors, becoming the largest single shareholder of Mitsubishi. In addition, the areas of cooperation between the two parties will also involve procurement, manufacturing, vehicle platforms and growth markets. Water Jet Loom,New Type Water Jet Loom,Single Adouble Water Jet Loom,Dobby Water Jet Loom Tianchi Changzhou Textile Machinery Co., Ltd , https://www.tcloom.com
On May 12, Nissan Motor Co., Ltd. and Mitsubishi Motors Corporation signed a Basic Agreement to deepen strategic cooperation and build relationships at the capital level.
According to the terms of the deal, Nissan will acquire 506.6 million new shares of Mitsubishi Motors, accounting for 34% of the total share price. The purchase price per share is 468.52 yen, totaling nearly 237 billion yen (about 2.2 billion US dollars). Or RMB 14.2 billion). The trading stock price is based on the average stock price between April 21, 2016 and May 11, 2016. Nissan will also receive four seats on the board of Mitsubishi Motors, one of which is expected to become the new chairman of Mitsubishi.
Following the basic framework agreement, Nissan and Mitsubishi plan to formally sign the contract on May 25, but the agreement will be void if it cannot be completed within one year.
According to Japanese law, once a major shareholder holds more than one-third of the shares, there is a veto in the major management decision.
Mitsubishi Motors' shareholding structure shows that the three companies under the same Mitsubishi Group are currently the main single shareholders (Single Shareholder): the largest shareholder is Mitsubishi Heavy Industries Ltd., with a shareholding ratio of approximately 20%. Second, Mitsubishi Corp. holds 10%; Mitsubishi Tokyo UFJ holds 4%.
In the agreement, Nissan and Mitsubishi also agreed to cooperate in various fields, including procurement, general vehicle platform, technology sharing, joint utilization of plant capacity and growth market.
On the morning of May 12, the Japanese media first disclosed that Nissan will acquire shares in Mitsubishi, saying that it may acquire a one-third stake in 200 billion yen. The two companies later confirmed that they were negotiating.
In fact, Nissan and Mitsubishi have been cooperating for five years. The two sides jointly develop and produce mini-cars with an engine displacement of no more than 0.66 liters in the Japanese domestic market, including the Mitsubishi brand eK Wagon and eK Space, and the DayZ and the development of the Nissan Motor Co. DayZ Roox. These mini-cars were involved in the fuel economy fraud scandal in April this year. The outsourcing of the stock purchase will undoubtedly greatly enhance the relationship between the two parties, from the product technology level to the capital level.
Mitsubishi "fuel consumption fraud scandal" and acquired acquisitions On April 20, 2016, Mitsubishi was exposed to improper use in fuel consumption testing. Currently, 625,000 mini-cars are known to be involved in Japan, and more vehicles are yet to be announced. It is reported that in terms of tires and air resistance, Mitsubishi uses US standards to measure, rather than Japanese standards, making the fuel economy test results better than the actual situation, the gap is about 5% to 10%.
After the scandal was exposed, Mitsubishi's share price plummeted. As of May 11, Mitsubishi Motors closed at 495 yen per share on the Tokyo Stock Exchange, down 43% from April 19. However, its share price in the US market rose 16% to $5.14 per share. Nissan shares fell 1.3% to 989.8 yen per share at 9:39 am on May 12, Tokyo time.
However, Mitsubishi officials did not recognize the economic pressure to the point where foreign aid needs to be introduced. Mitsubishi Motors President Yoshihiko announced at the May 11th conference that the company has enough cash to deal with the economic loss of “fuel consumption fake doors†is not a problem. At the same time, it also said that the company will continue to cooperate with Nissan - this can also be seen as a hint that the two sides form a potential capital alliance.
Since Nissan is the whistleblower of Mitsubishi, it has objectively contributed to the collapse of Mitsubishi's share price, and there is also a speculation that there is a correlation between the disclosure and the acquisition.
· Nissan 237 billion acquisition of 34% stake in Mitsubishi