Fiat Chrysler said it has abandoned its $35 billion merger offer for Renault, blaming French politics for scuttling what would have been a landmark deal to create the world’s third-biggest automaker, Reuters reads.
A source close to the French carmaker’s board said Fiat Chrysler made the move after France sought to delay a decision on the deal in order to win the support of Nissan Motor Co, Renault’s Japanese alliance partner.
French government officials had pushed for Nissan to support the merger. Nissan had said it would abstain.The French government, which owns a 15% stake in Renault, had also pushed Fiat Chrysler for guarantees that France would not lose jobs, and for a dividend to be paid to Renault shareholders, including the government, people familiar with the talks said. Fiat Chrysler’s original proposal offered no special dividend to Renault shareholders.
“It has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully,” Fiat Chrysler said in a statement issued early Thursday from London.
Renault, in a separate statement, said its 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.”