Just received this in my inbox. A press release from GM – and 10 days earlier than expected:
General Motors, Renault and Nissan said today that they had agreed to terminate discussions regarding a proposed alliance among the three companies.
The parties mutually recognized that significant aggregate synergies might result from the alliance. However the parties did not agree on either the total amount of aggregate synergies or the distribution of those benefits.
Based on its conclusions, GM had proposed that Renault-Nissan provide compensation as part of a potential alliance and for potentially precluding GM from entering other alliance opportunities if Renault-Nissan had made a significant investment in GM.
Renault and Nissan consider that the principle of compensation is contrary to the spirit of any successful alliance.
Carlos Bonaparte was talking up some potential savings of $10 billion for GM, which always seemed like it was over the mark. He was saying this publicly in the last week or so but those doing the numbers behind closed doors were obviously talking about different things.
The other thing that’s been a point of discussion is the simple fact that Renault and Nissan have a hell of a lot more to gain from this alliance than what GM does, hence GM’s request for some financial consideration up front.
Kirk Kerkorian, GM’s biggest single shareholder and the prime mover behind this idea in the first place, still thinks the idea has legs and has mentioned upping his GM stockholding by another 2 or 3 percent in order to try and force an independant study of the alliance proposal. It’ll be interesting to see what his next step is.
GM CEO Rick Wagoner is holding a press conference today to talk about it some more. Info will be published as it comes to hand.
UPDATE: From Automotive News via email:
General Motors and Renault-Nissan have terminated their discussions regarding a proposed alliance a day after GM directors voted unanimously against the plan.
The vote included one by Jerry York, who is billionaire GM shareholder Kirk Kerkorian’s representative on the board….
…..Tracinda Corp., the investment firm representing billionaire Kerkorian, today said: “We believe that General Motors’ participation in a global alliance with Renault-Nissan would have enabled GM to realize substantial synergies and cost savings. We regret that the board did not obtain its own independent evaluation of the alliance.”
My emphasis added. Hopefully Jerry can now shut Kirk up regarding this proposal.
No confirmation yet of the authenticity, but someone drew my attention to this representation of the final moments of the GMRN negotiations: