Fiat Chrysler abandons $35 billion Renault merger, blames French politics

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Fiat Chrysler abandons $35 billion Renault merger, blames French politics

Earlier on Thursday, the 6th of June 2019, the Italian-American carmaker, Fiat-Chrysler had issued a statement saying that it had withdrawn its $35 billion merger offer for the French carmaker Renault SA, blaming French politicians for evaporating the hopes of a deal what could have been a landmark milestone to create the world’s third largest automaker, behind Germany’s Volkswagen and Japanese Toyota.

In point of fact, a Renault spokeswoman had told following the reveal of the statement in terms of anonymity as the spokeswoman was not authorized to talk about the matter in public, that, the Italian-American carmaker decided to sway away of the deal and made a statement to call it off, after French government, which held a 15 percent stake at Renault SA, had decided to delay the decision in order to win the support of its Japanese alliance partner, Nissan Motor Co.

Besides, the source had also added while French government official had been pushing the Japanese carmaker to support the merger, Nissan Motor Co. had said that it would withdraw itself from the deal. Aside from that, people familiar with the matter had also unveiled following the reveal of Thursday’s (June 6th) FCA statement, the French government had been pushing FCA to guarantee French worker’s job safety, while they had also been asking for a dividend for the Renault shareholders alongside government, which had also prompted FCA to step off of the merger deal.

Addressing to political uncertainties casting shadows over the merger deal, Fiat Chrysler issued a statement on Thursday (June 6th) morning from its London headquarter saying, “It has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully,” while Renault had said at a separate statement, “(Renault) board was unable to take a decision due to the request expressed by the representatives of the French state to postpone the vote to a later meeting”.