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| Fiat Chrysler Withdraws Its Offer for Renault | Fiat Chrysler Withdraws Its Offer for Renault |
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| Fiat Chrysler late Wednesday abruptly withdrew a proposal to merge with Renault, walking away from a deal that had the potential to change the balance of power in the global auto industry. | |
| The stunning move came after two days of meetings at Renault’s headquarters in Paris in which its chairman, Jean-Dominique Senard, had sought to convince its board of the financial and industrial merits of a deal. | |
| In a statement Wednesday evening, Fiat Chrysler said it continued to believe that the merger proposal was solid and “carefully balanced to deliver substantial benefits to all parties.” But it added, “It has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully.” | |
| Since Fiat Chrysler officially unveiled its proposal on May 26, the plan has faced resistance by some Renault shareholders who argued that the Italian-American conglomerate was undervaluing a crown jewel of French industry. France’s powerful labor union at Renault objected to a deal, warning that a combined entity could lead to layoffs. | Since Fiat Chrysler officially unveiled its proposal on May 26, the plan has faced resistance by some Renault shareholders who argued that the Italian-American conglomerate was undervaluing a crown jewel of French industry. France’s powerful labor union at Renault objected to a deal, warning that a combined entity could lead to layoffs. |
| The negotiations were also complicated by Renault’s long-term alliance with Nissan. In a statement Monday, Nissan’s chief executive, Hiroto Saikawa, said a full merger with Fiat “would significantly alter the structure of our partner Renault,” and added, “This will require a fundamental review of the existing relationship between Nissan and Renault.” | |
| The withdrawal came after the French government said earlier Wednesday that it would not approve a deal unless Nissan, with which Renault has had a formal alliance for 20 years, backed the offer. | |
| In a statement posted to its website on Wednesday, Renault said it was unable to make a decision because representatives of the French government, which has a seat on the board, requested to postpone the vote. | In a statement posted to its website on Wednesday, Renault said it was unable to make a decision because representatives of the French government, which has a seat on the board, requested to postpone the vote. |
| A person with knowledge of the situation said the government had repeatedly asked to postpone a final decision, leaving Fiat to conclude that the two sides were not getting anywhere — despite eagerness by Mr. Senard and Renault’s principal leadership to strike a deal. | |
| John Elkann, the Fiat Chrysler chairman, held a whirlwind of meetings with French government officials in Paris over the weekend, promising that a deal wouldn’t lead to factory closures. The issue is politically sensitive for President Emmanuel Macron at a time when foreign companies including General Electric, Whirlpool and Ford are cutting thousands of jobs in France. |