The merger plan, which sought to create the world's third-largest automaker, had been viewed positively across the industry since it was announced last week. Talks collapsed suddenly overnight after the French government, Renault's top stakeholder, asked for five more days to obtain support from Nissan, the long-time Japanese alliance partner.French officials appeared taken aback. They blamed Fiat Chrysler for placing "massive pressure" to quickly take the offer or leave it.
In Italy, a representative of the powerful metal mechanics union expressed hope that the withdrawal was a "tough tactical position to eliminate Franco-Japanese rigidity and restart the negotiations." News of the plan's failure mainly hurt Renault's shares, which tumbled 7% to 52.45 euros. Fiat Chrysler's share price recovered from an early dip to trade up 1% to 11.83 euros.Those are that any merger had to be completed as part of the existing alliance between Renault and Nissan, preserve French jobs and factories, respect the governance balance between Renault and Fiat Chrysler and ensure participation in an electric battery initiative with Germany.
Le Maire is travelling to Japan this weekend to meet with Nissan officials on a previously arranged visit.Fiat Chrysler said that it remained "firmly convinced of the compelling transformational rationale of a proposal," noting it had been widely well-received in markets and in the industry and would have delivered benefits to all parties.
The combined company would have been worth almost $40 billion. If Nissan had gone along, it would have created the world's biggest auto company.