Renault’s request to send Ghosn successor rejected

TOKYO: Nissan Motor Co has rejected partner Renault SA’s request to send a successor with equal authority to replace ousted chairman Carlos Ghosn, sources close to the matter said yesterday, in a heightening leadership tussle at one of the world’s biggest automaker groups.

Renault, Nissan’s top shareholder which has retained Ghosn as CEO and chairman following his arrest last month for alleged financial misconduct, made the request during the Japanese automaker’s emergency board meeting on Nov 22, according to the sources.

The proposal was made to protect its business interests and maintain its influence within Nissan following Ghosn’s dismissal, the sources said.

But regarding the future relationship with Renault, Nissan CEO Hiroto Saikawa has said he wants to review the management structure, believing that the excessive concentration of power in Ghosn had undermined transparency and governance.

Ghosn, known for saving Nissan from the brink of bankruptcy, was sent to the Japanese automaker from Renault in 1999 as chief operating officer. He became Nissan president in 2000 and served as chief executive officer from 2001 to 2017.

Saikawa also views Nissan’s relationship with Renault as unbalanced and favouring the French carmaker.

Although smaller in earnings than Nissan, Renault owns a 43.4% stake in the Japanese automaker, which holds only a 15% stake in its French peer but without voting rights and 34% in Mitsubishi Motors Corp, the third alliance partner.

“Under the current agreement between Nissan and Renault, t he Japanese automaker is to receive senior executives from the French peer,’’ other sources said earlier.

Saikawa, Renault’s acting CEO Thierry Bollore and Mitsubishi Motors CEO Osamu Masuko agreed on Nov 30 to lead the three-way alliance through consultations between them, in an apparent departure from the decision-making process mainly until now led by the partnership’s CEO and chairman Ghosn, according to the Japanese executives.

Still, the struggle for leadership is expected to continue as under the current accord between Nissan and Renault the post of CEO and chairman of the alliance is to be assumed by someone from the French automaker, analysts say.

At the Nov 22 meeting, the Nissan board decided to dismiss Ghosn as chairman and set up a three-member panel comprised of external directors to select his successor from among the current board members.

The three independent directors held their first meeting yesterday to discuss who should succeed Ghosn as chairman, according to a Nissan official.

The board is expected to formally approve the successor at its meeting on Dec 17. “One of the plans is to have Saikawa double as interim chairman,’’ the sources said.

Ghosn was arrested by Tokyo prosecutors on Nov 19 on suspicion of violating Japan’s Financial Instruments and Exchange Act by underreporting his remuneration by a total of about five billion yen ($44 million) over five years to March 2015.

The Sankei newspaper reported yesterday that Tokyo prosecutors planned to arrest Ghosn on a fresh claim of understating his income, in a move that could keep him in detention until the end of the year.

Ghosn has been detained in Tokyo since his Nov 19 arrest. Tokyo authorities on Friday extended their detention until the maximum Dec 10 for the alleged crime.

Citing unnamed sources, the Sankei said prosecutors planned to arrest Ghosn and former Nissan representative director Greg Kelly on Dec 10 for the same crime covering the period from 2015 to 2017, during which the suspects allegedly understated Ghosn’s income by about four billion yen.

“If authorities approve the maximum detention for that case, Ghosn and Kelly would remain in custody until Dec 30,’’ the paper said.

The Tokyo prosecutors’ office declined to comment on the report.