Renault refrains from ousting Ghosn; names Bollore interim leader

November 20, 2018 16:42 CET

PARIS — Embattled Carlos Ghosn will keep his posts as Renault chairman and CEO, the automaker’s board decided Tuesday. The board appointed Renault Chief Operating Officer Thierry Bollore as deputy CEO with the same powers as Ghosn.

The board’s highest-ranked independent director, Philippe Lagayette, will chair its meetings for the time being, Renault said in a statement.

Bollore, 55, has been seen as Ghosn’s heir apparent at Renault since February when he was promoted to COO.

The soft-spoken French national from Brittany joined Renault in 2012 from supplier Faurecia, where he rose through the ranks to become vice president with responsibilities for global industry, quality and packaging. He started his career at tiremaker Michelin, working there for a number of years at the same time as Ghosn, who has called Bollore a “good candidate” to become Renault CEO.

Lagayette, 75, has been on Renault’s board since 2007 and leads the audit, risks and ethics committee as well as being part of the grouping that oversees executive compensation.

The board stopped short of firing Ghosn and requested that Nissan provide all information in its possession arising from its internal investigations that led to his arrest for alleged financial improprieties.

Nissan, by contrast, said after Ghosn was detained on Monday that it intends to dismiss Ghosn, 64, as chairman — acting with a haste that’s fueled open speculation that he was the victim of a coup by Nissan CEO Hiroto Saikawa, and others at Nissan opposed to deeper integration between the two companies.

Nissan’s board will meet on Thursday to make a formal decision on Ghosn’s future.

Renault’s board indicated that it was in the dark about the nature of the allegations against Ghosn. “At this stage, the board is unable to comment on the evidence seemingly gathered against Mr. Ghosn by Nissan and the Japanese judicial authorities,” the board said in its statement.

Ghosn is accused of under-reporting income of about $44 million and misusing company funds at Nissan, where he was also chairman. However, the full scope of potential allegations is unclear.

In a sign that Nissan may now seek to loosen its French parent’s hold on their decades-old alliance, the Japanese company informed Renault it also had evidence of potential wrongdoing at Renault-Nissan BV, the Dutch venture overseeing alliance operations under Renault’s ultimate control, sources told Reuters.

Ghosn, who was set to leave in 2022, had been laying the groundwork to ensure a future for the alliance, including the option of a merger. The setup has come under pressure from Nissan in recent years because of its lopsided balance of power in favor of Renault.

Bollore will be Renault’s deputy CEO with Ghosn’s powers.

Through complex cross-shareholding arrangements, Renault owns 43 percent in Nissan, including voting rights, while Nissan owns a 15 percent non-voting stake in Renault.

In a letter sent to Renault employees on Monday, Bollore expressed full support for Ghosn and pledged to preserve the alliance.

So far the French government, which is Renault’s largest shareholder, is reserving judgment on Ghosn. On Tuesday, Economy Minister Bruno Le Maire told France Info radio that “we will not demand he be removed” from the company because “we have no proof.” France has examined Ghosn’s local tax records and found “nothing particular,” Le Maire said.

While both Le Maire and his Japanese counterpart, Hiroshige Seko, reaffirmed their support for the alliance, the structure of the partnership between the two companies has been increasingly controversial in Japan as Nissan outgrows Renault in sales and profits.

Reuters and Bloomberg contributed to this report

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