DHAKA: French Prime Minister Manuel Valls said the government did not want carmakers Renault and Nissan to merge.

At the moment the companies own large shareholdings in each other and co-operate closely, reports the BBC.

However, on Friday Renault held an emergency board meeting amid reports the French government, one of its biggest shareholders, wanted a merger.

Valls has denied that, saying he hopes the existing alliance, which dates back to 1999, would continue.

‘The state is fully playing its role as a shareholder,’ the French prime minister said. ‘And at the same time, we fully trust Nissan and Renault managers’.

French car manufacturer Renault owns 43% of Nissan, while the Japanese firm holds 15% of Renault.

Last week Reuters reported that French economics minister Emmanuel Macron had been pressuring Carlos Ghosn, who serves as chief executive of both companies, to undertake a full merger.

Amid escalating tensions, Renault said on Friday it had started the ‘first stage in discussions between the two main long-term Renault shareholders, the French government and Nissan’.

Nissan has expressed concern after the French government unexpectedly raised its stake in Renault to 19.7% and doubled its voting rights in April.

The move had ‘highlighted an imbalance in the Renault-Nissan alliance’, Nissan chief competitive officer Hiroto Saikawa, a Renault director, said on Friday.

‘Nissan would like to put this matter behind us as soon as possible so that we can re-establish the foundations of a successful alliance and focus on our real business,’ he added.

BDST: 2153 HRS, Nov 08, 2015
RR