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Nissan, Renault and Mitsubishi shore up alliance amid Ghosn’s departure

Nissan, Renault and Mitsubishi shore up alliance amid Ghosn’s departure
Junichiro Hironaka, lawyer for former Nissan chief Carlos Ghosn, speaks with the media outside his office in Tokyo on March 11. A Japanese court barred Carlos Ghosn from attending a Nissan board meeting. (Behrouz Mehri / AFP/Getty Images)

Nissan Motor Co. and its partners Renault and Mitsubishi Motors Corp. are considering forming a single board for their alliance now that Carlos Ghosn has been sidelined by his arrest.

The three companies have scheduled a joint news conference at Nissan’s headquarters in Yokohama on Tuesday afternoon after a Nissan board meeting when the matter will be discussed.

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As architect of the structure and former chairman of all three companies, Ghosn was seeking to join Nissan’s meeting to explain himself personally to fellow directors. The Tokyo District Court rejected his request, saying it would violate terms of his bail forbidding him from contacting people involved in the charges against him of falsification of financial records and breach of trust.

Janet Lewis, an analyst for Macquarie Capital Securities (Japan) Ltd. in Tokyo., said that given the extent to which the alliance is working to overhaul its structure, Ghosn’s presence wouldn’t have made much of a difference.

“I don’t see how turning up at Nissan’s board meeting is going to change anything,” Lewis said. “The alliance is working on how to improve its governance and how the new Renault leadership team can best work with Nissan and Mitsubishi. The Ghosn court case is a sideshow that should not impact the future direction of the alliance.”

At Tuesday’s meeting, Nissan’s directors will discuss replacing two separate Amsterdam-based alliance entities, Renault-Nissan and Nissan-Mitsubishi, people familiar with the matter said, asking not to be identified because the information isn’t public.

The new plan for the alliance is aimed at fostering more balanced decision-making represented by Renault Chairman Jean-Dominique Senard, Nissan Chief Executive Hiroto Saikawa and Mitsubishi Motors CEO Osamu Masuko. Senard will probably chair the new committee, one of the people said.

Spokesmen for Nissan and Mitsubishi declined to comment on the reported new structure.

The current organization for the alliance is considered outdated and obscure in its functions, with the carmakers’ own investigations having found that Ghosn funneled money from the Dutch units.

However, Ghosn has said the claims of improper payments are a “distortion of reality” and it’s possible that he will seek to make the case for his innocence in interviews and possibly a news conference as soon as this week. Ghosn, who engaged the media throughout his career, already gave several jailhouse interviews to Japanese and French media.

Still, Ghosn has kept a low profile since exiting a Tokyo detention center on March 6 disguised as a construction worker. Japan’s media reported on Ghosn sightings around Tokyo, but he has yet to give an interview or speak directly to the media since his release. Instead, he’s relying on an “all-star” team of lawyers to communicate with the public as they prepare his defense.

Junichiro Hironaka, Ghosn’s lead attorney, said the car titan agreed to “severe” bail conditions — including staying in Japan, paying 1 billion yen in bail ($9 million), having cameras installed at the entrance and exit of his home, restrictions to using his mobile phone and having no access to the internet. Ghosn and Greg Kelly, another Nissan executive arrested in the case, aren’t allowed to contact those involved with the investigations at Nissan, Renault and other entities.

Although Ghosn was stripped of his titles, he remains a director at Nissan and Renault. A vote on whether to remove him from the board will take place at a meeting of Nissan shareholders April 8.

The bigger question is whether a planned merger between Nissan, Renault and Mitsubishi will happen. Although Nissan is said to have sought a review of the pact’s lopsided power structure that favored Renault, the two have pledged their allegiance to each other with plans to extend a two-decade accord.

“Now that Ghosn’s influential leadership is gone, there’s a risk that each party will become more sharply focused on their self-interests,” said Tatsuo Yoshida, an analyst at Sawakami Asset Management. “They need to have a structure where decisions are made transparently.”

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