Japanese automakers Honda and Nissan announced on Thursday that they have ended discussions on a merger that would have created one of the largest automakers in the world after the two companies failed to reach an agreement on the structure of the deal.
Honda and Nissan called off talks for a merger that was first announced is December.
Both companies issued statements announcing the termination of the talks and said the decision was made to “prioritize speed of decision-making and execution of business measures” in a market that is being shaken by electric vehicles.
The statements pointed to a key disagreement between the two automakers over Honda’s proposal to change the structure of the deal, which was first announced in December.
Instead of establishing a joint holding company, Honda’s changed proposal called for Nissan to become a subsidiary “through a share exchange.”
Despite calling off the merger, the companies said they still intend to collaborate under a strategic partnership “aimed at the era of intelligence and electrified vehicles,” which was first announced in March last year.
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The price of Honda Motors’ Tokyo Stock Exchange-listed shares rose 2.14% to $9.30 (¥1,434) on Thursday, while Nissan’s shares fell to $2.70 (¥415), down 0.35%.
This is a developing story.