Mitsubishi Motors contemplating not becoming a member of deliberate Nissan-Honda merger, sources say

TOKYO (Reuters) -Japan’s Mitsubishi Motors (OTC:MMTOF), a junior associate of Nissan (OTC:NSANY) Motor, is contemplating not becoming a member of a deliberate merger between Nissan and Honda (NYSE:HMC) Motor, sources instructed Reuters on Friday.

Mitsubishi Motors plans to stay listed whereas persevering with its cooperative relationship with each corporations, three sources mentioned on situation of anonymity as a result of they weren’t authorised to discuss the matter publicly.

Shares of Mitsubishi Motors had been down 3.9% by the lunch break after slumping greater than 6% in early commerce on Friday. Nissan shares misplaced 0.7% and Honda shares had been buying and selling 0.1% decrease.

The event comes after Nissan and Honda final 12 months mentioned they might start formal talks on a merger that would probably create the world’s third-largest auto group with annual output of seven.4 million autos.

Mitsubishi Motors, through which Nissan is the highest shareholder with a 24% stake, was anticipated to resolve by this month whether or not it plans to participate.

In an announcement, Mitsubishi Motors mentioned there had been media reviews on the best way it intends to take part within the enterprise integration framework that Honda and Nissan are contemplating, however the reviews weren’t primarily based on info introduced by the corporate.

It added it was contemplating varied potentialities at this stage, and its course had not but been determined.

The Yomiuri newspaper reported earlier on Friday that Mitsubishi Motors was contemplating not becoming a member of the deliberate tie-up on considerations that it will be tough for it to have an effect on administration selections of the joint holding firm given its comparatively small dimension.

When requested about Yomiuri’s report, spokespeople for Nissan and Honda referred to Mitsubishi Motors’ assertion, with out commenting additional.

Nissan and Honda mentioned in December they purpose to finish their talks round June 2025 earlier than organising a holding firm by August 2026, when shares of each corporations can be delisted.

Mitsubishi Motors will keep its present construction for now and give attention to increasing its share within the Southeast Asian market, the Yomiuri report mentioned.