Renault shares surge on report of merger talks with Nissan

 
Rebecca Smith
A merger could create a new auto giant
A merger could create a new auto giant (Source: Getty)

Shares in Renault have jumped this morning on reports of a merger between the French automaker and Nissan.

Bloomberg reported this morning that Renault was in talks for a tie-up with Nissan to create a new car giant that will trade as a single stock.

Shares in the French firm soared by more than seven per cent on the news.

Read more: Renault, Nissan and Mitsubishi have teamed up to launch a $1bn VC fund

Earlier this month, the Renault, Nissan and Mitsubishi alliance denied reports that Nissan was in talks to acquire the French state's stake in Renault - a move touted as an initial step to a possible merger.

A Franco-Japanese strategic partnership was formed between the car manufacturers in 1999, joined through a cross-sharing agreement.

At the beginning of the year Renault, Nissan and Mitsubishi announced they had launched a new venture capital fund, Alliance Ventures, with plans to invest up to $1bn over the next five years.

The firm, which is set to become the largest corporate venture capital fund in the automotive industry, expects to plough up to $200m into startups and innovation partnerships in its first year. Renault and Nissan will each provide 40 per cent of the capital, while Mitsubishi Motors will add the other 20 per cent.

Its first deal came in the form of US battery technology company Ionic Materials.

As well as acquiring part of the firm, Alliance has agreed a research and development partnership with Ionic – which could help drive innovation in electric cars.

Read more: Renault and Nissan deny reports of French government stake sell off

Related articles