France’s State Share Agency says it has formally increased its stake in Renault to almost 20% despite the automaker’s demand Paris reverts to its previous 15% holding.
The hugely contentious issue is about to come to the boil at Renault’s Annual General Meeting next week (30 April), but at recent snap board meeting, Renault directors urged CEO, Carlos Ghosn to ensure the “balance” between the two main shareholders be maintained.
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The French State’s move to up its stake in the automaker is based on the Loi Florange, designed to allow those holding shares for at least two years to be granted double voting rights.
“This move marks both the will of the State to defend its interests as shareholder, weighing in favour of a double vote in the management of Renault and the strategic nature it attaches to its capital stakeholding in this large industrial enterprise,” said a statement from the Agence des Participations de l’État (APE).
“The government is and will be, careful to exercise its influence in respect of the Alliance balance with Nissan…and in support of Carlos Ghosn’s commitment to sustain and deepen this Alliance.
“In accordance with its objectives, the increase of the State in Renault’s capital is only temporary. It does not mean in any way a move up or down in its involvement in the capital of the business.”
Specifically, the APE has upped its stake in Renault from 15.01% to 19.74% and now holds 58.4m shares.
The French State maintains double voting rights encourage investors to keep hold of shares and to increase the influence of shareholders in the long term, while also pointing out such double voting is already a reality in more than half of businesses on the French CAC 40 stock exchange.
Renault was not immediately available for comment.
