Nissan shares fall 5% after Renault report exploring stake cut

TOKYO, April 25 (Reuters) – Shares of Nissan Motor Co Ltd (7201.T) fell 5% on Monday, their biggest drop in more than a month, following a report that the shareholder Principal Renault SA (RENA.PA) may consider lowering its stake in the Japanese automaker.

Bloomberg reported on Friday that Renault may consider reducing its stake in Nissan as part of its plan to separate its electric vehicle business. The French automaker has pushed ahead with plans to split its electric and combustion engine businesses in a bid to nab rivals such as Tesla (TSLA.O) and Volkswagen (VOWG_p.DE) read more

On Friday, Renault said all options were on the table to separate the electric vehicle business, including a possible IPO in the second half of 2023.

Any plan would be subject to approval by alliance partner Nissan, Renault chief financial officer Thierry Pieton said, adding the Japanese automaker was “in the know” as Renault weighed its options.

Renault and Nissan declined to comment on the report.

Shares of Nissan fell to 509.8 yen in Tokyo, marking their biggest one-day drop since early March and underperforming a nearly 2% decline in the Nikkei index (.N225).

The two-decade-old automakers alliance, which includes Mitsubishi Motors (7211.T), has been rocked by the 2018 ousting of alliance founder Carlos Ghosn amid a financial scandal. They have since pledged to pool more resources.

In January, they said they would work more closely together to make electric cars. They detailed a $26 billion investment plan for the next five years.

But their unequal relationship has long been a source of friction in Japan. Renault owns 43.4% of Nissan, which in turn owns a 15% non-voting stake in its shareholder. Renault bailed out Nissan two decades ago but is now the smallest automaker by sales.

Reporting by Satoshi Sugiyama and David Dolan; Editing by Bradley Perrett and Muralikumar Anantharaman

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