Nissan Motor Co shares jumped after the Financial Times reported that a high-level Japanese group has drawn up plans to seek investment from Elon Musk’s Tesla Inc to aid the struggling automaker.
The group believes the electric vehicle (EV) maker is interested in acquiring Nissan’s plants in the US, the newspaper reported, citing people it did not identify.
The proposal envisions a consortium of investors, with Tesla as the largest backer, but also includes the possibility of a minority investment by Hon Hai Precision Industry Co (鴻海精密) to prevent a full takeover by the Apple supplier, the report said.
Photo: AFP
The group is being led by former Tesla board member Hiro Mizuno and supported by former Japanese prime minister Yoshihide Suga, the Financial Times reported.
Shares jumped more than 12 percent on the news of the potential investment.
A Nissan spokesperson declined to comment on the report. Tesla did not immediately respond to an e-mailed request for comment. Mizuno and a representative for Hon Hai did not immediately respond.
Nissan finds itself in need of a lifeline once again after a deal with Honda Motor Co to combine the two brands under a single holding company formally ended earlier this month. The fallout of the scrapped deal has been especially pointed for Nissan, which has seen weak sales, overcapacity, an outdated lineup of unpopular models and revolving-door leadership since the 2018 ouster of former Nissan CEO Carlos Ghosn.
That is putting pressure on the automaker to find support, and Nissan CEO Makoto Uchida has said it would be difficult to survive without leaning on a partnership.
Still, a deal with Tesla would be unexpected in part, because of the EV maker’s own struggles amid a market slowdown. Last month, it reported a drop in annual sales for the first time in more than a decade, and it has cut more than 10 percent of its workforce, including sales staff.
“For Tesla, it’s difficult to think there are any merits in buying Nissan,” Rakuten Investment Management Inc investment head Yasuhiko Hirakawa said. “It obviously has no need for legacy assets like engines and assembly lines. It’s difficult to imagine something Tesla needs that Nissan can offer.”
Despite Nissan’s challenges, its vast manufacturing operations and brand recognition are still enticing suitors.
Hon Hai has expressed renewed interest in Nissan after the deal with Honda collapsed, and Bloomberg News reported earlier this month that KKR & Co is weighing an investment in Nissan.
However, the carmaker continues to face risks from its restructure and the challenging geopolitical landscape. Moody’s Ratings on Friday cut its credit rating to speculative-grade and maintained a negative rating outlook.
“Whoever the buyer is, Nissan’s restructuring is unavoidable,” MCP Asset Management Japan strategist Rieko Otsuka said.
STRONG INTEREST: Analysts have pointed to optimism in TSMC’s growth prospects in the artificial intelligence era as the cause of the rising number of shareholders The number of people holding shares of chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) hit a new high last week despite a decline in its stock price, the Taiwan Depository and Clearing Corp (TDCC, 台灣集保) said. The number of TSMC shareholders rose to 2.46 million as of Friday, up 75,536 from a week earlier, TDCC data showed. The stock price fell 1.34 percent during the same week to close at NT$1,840 (US$57.55). The decline in TSMC’s share price resulted from volatility in global tech stocks, driven by rising international crude oil prices as the war against Iran continues. Dealers said
PRICE HIKES: The war in the Middle East would not significantly disrupt supply in the short term, but semiconductor companies are facing price surges for materials Taiwan’s semiconductor companies are not facing imminent supply disruptions of essential chemicals or raw materials due to the war in the Middle East, but surges in material costs loom large, industry association SEMI Taiwan said yesterday. The association’s comments came amid growing concerns that supplies of helium and other key raw materials used in semiconductor production could become a choke point after Qatar shut down its liquefied natural gas (LNG) production and helium output earlier this month due to the conflict. Qatar is the second-largest LNG supplier in the world and accounts for about 33 percent of global helium output. Helium is
Taiwan’s natural gas supply remains stable through the end of May, despite rising concerns about potential disruptions to Qatari liquefied natural gas (LNG) supplies due to escalating conflicts in the Middle East, the Ministry of Economic Affairs said yesterday. The ministry in a statement said that Taiwan has completed preparations for natural gas supply and shipping schedules through the end of May. It has also made plans to increase natural gas imports from regions outside the Middle East in June to ensure a stable supply, it added. Taiwan sources natural gas from 14 countries and is not solely dependent on the Middle East,
China is clamping down on fertilizer exports to protect its domestic market, industry sources said, putting an additional strain on global markets that were already grappling with shortages caused by the US-Israeli war on Iran. China is among the largest fertilizer exporters — shipping more than US$13 billion of it last year — and it has a history of controlling exports to keep prices low for farmers. Shipments through the war-blocked Strait of Hormuz account for about one-third of the sea-borne supply. This month, Beijing banned exports of nitrogen-potassium fertilizer blends and certain phosphate varieties, sources said. The ban, which has not
RSS