France backs Renault's current plan, source says, amid merger talk

Reuters
Tue, February 6, 2024

French car maker Renault holds an investor day for its EV unit Ampere in Paris

PARIS (Reuters) - France continues to support Renault's strategy of remaining a standalone carmaker with several industrial and technological partnerships, a finance ministry source said on Tuesday, after a newspaper reported the government was studying a Renault merger.

Italian daily Il Messaggero reported on Sunday that the French government, which is Renault's largest shareholder and also has a stake in Stellantis, was examining plans for a merger between the two groups.

Asked about the government's position towards Renault's strategy, the source said there was "no change".

The government has from the start supported Renault Chief Executive Luca de Meo's strategy to build up a new France-based electric and software unit called Ampere alongside Renault's legacy internal combustion engine and hybrid businesses.

While recognising that Renault lacks the scale and resources of its rivals, the government has also supported the company's efforts to build ties beyond its traditional allies Nissan and Mitsubishi by striking up partnerships with Geely, Saudi Aramco, Google and Qualcomm.

With its stock market value stagnating around 10 billion euros ($10.7 billion) despite improved finances, Renault is often cited in financial markets as a potential takeover target.

The group's decision last week to scrap Ampere's initial public offering rekindled such rumours, which had previously surfaced after the group's 2022 exit from Russia, its second biggest market after France at the time.

Stellantis Chairman John Elkann denied on Monday that the carmaker had merger plans, responding to press speculation about a tie-up with Renault, which declined to comment.

($1 = 0.9318 euros)

(Reporting by Gilles Guillaume and Leigh Thomas; Editing by Richard Lough and Mark Potter)