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Ousted Nissan chair makes another bid for bail as his peers fly to Davos

Ousted Nissan chair makes another bid for bail as his peers fly to Davos
Business
PARIS—At this time of year, Carlos Ghosn would normally be hobnobbing with the global elite at the World Economic Forum in Davos. Instead, he’s languishing in a Tokyo prison.

Now the ousted Nissan Motor Co. chair is making a last-ditch effort to win release on bail by pledging to remain in Japan before his trial for alleged financial misconduct. He’s even offered to wear an electronic tracker and be monitored by private security guards, both at his own expense.

Ousted Nissan boss Carlos Ghosn has pleaded for bail after languishing in custody since Nov. 10 as he fights charges of financial misconduct that he strenuously denies.  (TORU YAMANAKA / AFP/GETTY IMAGES)

“I will reside in Japan and respect any and all bail conditions the court concludes are warranted,” Ghosn, 64, said in a statement. “I will attend my trial not only because I am legally obligated to do so, but because I am eager to finally have the opportunity to defend myself.”

Ghosn has been in custody since Nov. 19, accused of financial crimes that could put him behind bars for decades. The auto titan has been indicted for understating his income at Nissan by tens of millions of dollars and transferring personal trading losses to the carmaker. Nissan also claims that Ghosn misused company funds, including for homes from Brazil to Lebanon, and hired his sister on an advisory contract. Ghosn has denied wrongdoing.

Sudden fall

His downfall, as sudden as it was unexpected, has roiled the two-decade alliance between Nissan and France’s Renault SA, which he dominated as board chair of both companies and of the entity that governs their partnership. France’s finance minister and Nissan CEO Hiroto Saikawa were both quick to downplay a report in the Nikkei newspaper over the weekend that the French side was planning to put the two carmakers under one holding structure.

During two decades astride the global auto industry, Ghosn became one of the most celebrated corporate chieftains of his generation, epitomizing an elite cadre of brash, jet-setting industrialists focused squarely on the bottom line. He was seen as the quintessential Davos figure, someone on the A-list of the global economic summit in the Swiss ski resort. The annual event kicks off Tuesday.

While Nissan fired Ghosn almost immediately, he still retains his posts at Renault and at the alliance — though probably not for much longer. Michelin’s chief executive officer Jean-Dominique Senard is expected to join Renault’s leadership, people familiar with the matter have told Bloomberg News.

Renault’s executive board may meet on Wednesday and name Senard non-executive board chair and head of the alliance, and at the same time appoint Thierry Bollore as Renault’s CEO, Le Figaro reported Sunday. Bollore is currently acting as CEO on an interim basis. A Renault spokesperson declined to comment.

Tensions are simmering on both sides of the alliance because of its lopsided structure. While Nissan has outgrown Renault in sales and profits, the Japanese company has far less influence. It owns 15 per cent of Renault, which in turn has 43 per cent of Nissan. France is Renault’s most powerful shareholder, with a 15 per cent stake, extra voting rights and two seats on the board. Mitsubishi Motors Corp. was added to the alliance in 2016.

Alliance angst

A delegation including Martin Vial, a Renault director designated by the French state, visited Japanese officials including Saikawa in Tokyo last week. According to people close to the delegation, the discussions focused on possible ways and ideas to cement the Renault-Nissan alliance, with the creation of a single holding company for both carmakers being one of the options.

The people emphasized that no proposal was made at the meeting and it’s too early to discuss concrete plans, asking not to be identified because the deliberations are confidential.

Bruno Le Maire, the French finance minister, downplayed prospects for a change to the alliance. “No shareholding rebalancing or modification of cross shareholdings between Renault and Nissan are on the table,” he told Journal du Dimanche in an interview published Saturday. He reiterated that France wanted “solid and stable” governance at the helm of the company.

The alliance partners aren’t yet at a stage where they can further discussions on their capital relationship, and Renault has to sort out its management structure before the two boards can have a thorough discussion, Saikawa told reporters on Monday. Saikawa said he hadn’t heard that the French government has proposed a merger of Nissan and Renault.

While Nissan wants to maintain the partnership, it will likely resist any push toward a full combination, another person familiar with the matter said. Ghosn had been pushing for a closer integration before his arrest, including a possible merger that Bloomberg reported last year, but Nissan has balked.

Nissan is also said to be considering doing away with the board chair title, a move that would deprive Renault of some of its influence.

Surrendering passport

Ghosn’s lawyers made a fresh application for bail on Friday, after a court last week rejected his previous request. He should find out if it’s accepted on Tuesday morning Tokyo time, according to Ghosn’s lawyers, represented by Motonari Otsuru.

If released, he’s willing to surrender his passport, offer shares as collateral and refrain from contact with anyone who could be a witness against him, said Devon Spurgeon, a family spokesperson. Ghosn’s previous requests for release envisioned him heading to France, where he’s a citizen, before returning to Japan for trial.

Even a highly-restricted release would allow Ghosn to more easily prepare for trial. As is customary in Japan, while in custody he’s been extensively interrogated without his lawyers present, and has no access to documents that could help him construct a defence. He has also been barred from seeing or communicating with his family.
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