In a surprising move, Fiat Chrysler hasdropped its proposal to merge with Renault.
This latest news comes after earlier reports suggested that the company was looking for a 50/50 merger transaction. In an official announcement, the company said, “The Board of Fiat Chrysler Automobiles NV, meeting this evening under the chairmanship of John Elkann, has resolved to withdraw with immediate effect its merger proposal made to Groupe Renault. FCA expresses its sincere thanks to Groupe Renault, in particular to its chairman and its chief executive officer, and also to the alliance partners at Nissan Motor Company and Mitsubishi Motors Corporation, for their constructive engagement on all aspects of FCA’s proposal.”
Shortly afterwards, the Wall Street Journal reported that the Nissan refused to support the deal as the company’s representatives were doubtful about Fiat Chrysler’s commitment to the merger. Moreover, the French Government maintains about 15 percent stake at Renault and proceeded to confirm that it won’t be approving the merge as Nissan pulled out of the deal.
In a statement, the Renault said, “Groupe Renault expresses its disappointment not to have the opportunity to continue to pursue the proposal of FCA. We view the opportunity as timely, having compelling industrial logic and great financial merit, and which would result in a European-based global auto powerhouse.”
As it stands, it’s unclear whether the merge will still go through. However, we are likely to know in the coming days if Fiat Chrysler completely drops its interests completely from the possible agreement.