Fiat’s French appeasement game is means to an end 3 Jun 2019 Chairman John Elkann is mulling concessions to get the French state to greenlight the $35 bln Renault merger. A board seat for Paris and some cash shouldn’t risk planned cost savings, or Nissan’s assent. It’s a small price to pay for first-mover advantage in car consolidation.
Renault-Fiat merger savings matter more than price 31 May 2019 The French carmaker’s board may feel a proposal by its Italian-American rival takes advantage of a depressed share price. The bigger prize, though, is synergies worth 50% of combined operating profit. If those are credible, Renault should not quibble too much about valuation.
Viewsroom: A new game of carmaker matchmaker 30 May 2019 Fiat Chrysler spurned Peugeot by offering to merge with France’s Renault, which is itself joined to Nissan. How will the pairings play out, and what does it mean for the automotive sector? Plus: Why fossil-fuel giants like BP are painting themselves a pale shade of green.
Cox: Merger of equals is French expletive 30 May 2019 Fiat and Renault hope to succeed where other deals billed as partnerships failed to deliver on promises to France. From LafargeHolcim and Alcatel-Lucent to TechnipFMC and EssilorLuxottica, hopes have been dashed. Proving the exception requires an understanding of those failings.
Arduous road awaits refueled Chinese used-car app 29 May 2019 Uxin is issuing $230 mln of convertible bonds, including to existing investors TPG and Warburg Pincus. It follows a 70% loss in market value since last year's IPO. A short attack, China’s slowdown and generous terms make it hard to see the deal as accurately calling a bottom.
Fiat-Renault deal leaves Peugeot in the M&A dust 28 May 2019 The $21 bln auto group looks strategically boxed in now its Italian-American suitor may pair with French rival Renault. CEO Carlos Tavares could try Indian-owned Jaguar Land Rover or General Motors. Yet both Plan Bs lack the $6.3 bln of cost savings he’s missed out on with Fiat.
Nissan gets cheap ride on Fiat Chrysler bandwagon 28 May 2019 The Japanese carmaker could reap over 1 bln euros of savings if 20-year partner Renault merges with its Italian-American rival. It also would curb France’s influence, give Nissan a seat at a bigger table and buy it time to regroup. Diluted strategic clout is a small price to pay.
Fiat gets motors revving on auto consolidation 27 May 2019 The Italian-American car group proposed a 33 bln euro merger with Renault that should keep Nissan warm, please the French state and give the Agnelli family a chunk of cash. More importantly, it unlocks a 5 bln euro bonanza of cost savings that will put industry rivals on notice.
Car industry second-stringers lock arms to compete 26 May 2019 Renault and Fiat Chrysler are crafting an alliance that could let them cut costs, pool technology and better bargain with rivals. Even without merging, savings could be worth more than Renault’s 15 bln euro market value. Former Fiat boss Sergio Marchionne’s dream is coming true.
Nissan chief makes useful scapegoat for everyone 17 May 2019 Hiroto Saikawa may stay longer than expected at the $30 bln Japanese carmaker. Nissan is in shambles, but there's a case for letting him clean up the worst of it, then hiring a more charismatic successor. If he makes things worse, Renault has a stronger argument for merging.
Nissan tough-guy defence looks shaky 14 May 2019 The Japanese car giant resisting a merger with Renault said operating profit fell 44% this year, and predicted more pain ahead. CEO Hiroto Saikawa says this is "rock bottom", but the dismal outlook might see shareholders warm to a deal, or demand new management.
German $6 bln flop shows private equity’s dilemma 14 May 2019 Hellman & Friedman and Blackstone axed a takeover of listings group Scout24, after too few investors accepted. Rising valuations for peers like Auto Trader made the offer look stingy. Buyout groups want assets that promise growth, but frothy markets mean they’d have to overpay.
Nissan could easily tempt a bold activist 13 May 2019 The $31 bln carmaker is resisting deal talks with Renault. An arm’s-length arrangement favoured by boss Hiroto Saikawa will only weigh on Nissan’s value. Pushy investors have been chipping away at corporate Japan. One able to handle the politics could help make the case for M&A.
Toyota and Honda may want to rev up in China 8 May 2019 The Corolla maker’s operating profit grew a mere 2.8 pct in its latest fiscal year. Toyota’s outlook is also modest while rival Honda cut sales forecasts across the board. The Chinese market, though struggling now, could yet provide some refuge from Donald Trump’s trade warpath.
Musk’s roundabout finance runs on short sellers 7 May 2019 The Tesla CEO reduced some pressure by raising $2.7 bln of capital. But he relied heavily on convertible bonds, a vehicle dominated by the very traders he despises. And ditching long-held financial goals for robo-taxis bolsters the bears’ case against his electric-car outfit.
Tesla’s $2 bln capital raise repeats sins of past 2 May 2019 The electric-car maker’s issue of shares and convertible bonds will barely cover planned capital expenditure, let alone losses like the one it just reported. CEO Elon Musk is betting vehicle sales will rebound quickly. That’s the kind of hubris that put Tesla in its current fix.
VW’s reform drive needs more horsepower 2 May 2019 A year after taking the wheel, CEO Herbert Diess has canned a much-needed truck IPO and now expects 2019 operating profit will be at the lower end of his target range. The 82 billion euro carmaker won’t close the valuation gap with peers unless he gets the spinoff back on track.
Cox: Ghosn affair shoves Japan two steps back 2 May 2019 Harsh treatment by prosecutors has amazingly elicited some sympathy for the Nissan boss. Neither greed nor running the automaker like a deity is a crime. And the presumption of guilt on other matters is unseemly. It may scare off foreign executives just as Japan Inc goes global.
Subsidies gas up turnaround at Buffett-backed BYD 29 Apr 2019 The Chinese electric vehicle maker reported a stupendous 632 pct increase in first-quarter net profit. Around half of the boost came from generous government grants, which may not be sustained. Even so, investors have cause for cautious celebration.
Renault M&A plan is lesser of two evils for Nissan 26 Apr 2019 The Gallic carmaker is once again pushing for closer integration with its partner, Nikkei says. If the Japanese company were to win concessions, such as board seat parity or an equal stake in a merged group, a deal would make more sense than the current mess.