Nissan Motor Co Ltd said on Thursday it had completed a deal to take a controlling stake in Mitsubishi Motors Corporation.
Carlos Ghosn, the Chairman and Chief Executive Officer of both Nissan and Renault, however, said at a joint briefing in Tokyo that the deal would await shareholder’s approval.
He said that Nissan would retain Mitsubishi’s embattled chief executive, Osamu Masuko.
But Ghosn would lead the Board of Mitsubishi Motors.
Ghosn added that Mitsubishi Motors Corp’s fortune dropped due to mileage cheating scandal.
According to him, Masuko will remain Mitsubishi’s president and CEO despite calls earlier this year by some shareholders for him to resign to take responsibility for falsifying the mileage on its vehicles.
Ghosn said keeping Masuko was an “important condition” in proceeding with the partnership, adding all management decisions would be made by Masuko.
He said: “One of the reasons that I so much wanted Masuko to stay as CEO was because I wanted the people at Mitsubishi to know that Mitsubishi will remain Mitsubishi.
“Mitsubishi will not become a subsidiary of Nissan.
“This sends a strong message that it’s not Nissan that’s going to transform Mitsubishi, it’s Mitsubishi that’s going to transform Mitsubishi.”
Nissan has agreed to make a 237 billion yen ($2.29 billion) investment to acquire 34 per cent of Mitsubishi Motors.
The deal makes Nissan the single largest shareholder in its smaller peer and gives it enough of a stake to wield control under Japanese shareholding rules.
The deal offers Mitsubishi a lifeline after the automaker earlier this year admitted to overstating the mileage on some of its cars.
Nissan is hoping to capitalise on Mitsubishi’s strong presence in developing Asian countries to lift its lagging market share there.
Nissan and Mitsubishi Motors said their partnership would generate synergies in areas including purchasing and plant utilisation.
They added that they would jointly develop automated driving technologies and plug-in hybrid vehicles.