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Nissan's big brother in Japan comes to the rescue
A burst of new models will see Nissan claw back some of its lost market share, writes DON ROBERTSON
Nissan Motor Corporation (NMC) will buy a 50% stake in Automakers, holding company for Nissan SA, for R360.7-million by taking 92.5-million Automakers shares up at 390c each. The deal depends on minority shareholders accepting an offer by Sankorp, Automakers' largest shareholder, to buy out their 66.6-million shares at 411c and to de-list the company. Last month's offer by Sankorp sparked a flurry of activity. Automakers' share rocketed from 206c to 380c in a matter of days amid claims of insider trading. Rumours then were that NMC would acquire a significant shareholding in Nissan SA, which also manufactures the Fiat Uno and distributes imported Alfa Romeos. The Japanese group is due to take full control with its own half share, the 4,3% held by Nissan Diesel and 8,7% held by trading group Mitsui. Both these stakes were bought before Automakers was listed in October 1995. Newbury, fresh from a consultative trip to Italy, says he is extremely excited about prospects for the group, following the collapse of his listed company after only 14 months on the JSE. The benefits to Automakers will, however, take some time to be realised. "There will be a lean year, but many years of feasting after that. Our share of the market fell to 13.1% last year, but we hope to push this up to 20% by 2000," he says. One consequence of the deal is that the introduction of new Nissan models will be expedited. "An aggressive burst of new models will be introduced in the next few years which will substantially beat the opposition. We now have access to any new models introduced in Japan," Newbury enthuses. Nissan SA will become part of the global group and link up with integrated component production elsewhere in the world. Increased exports are expected, especially through Nissan Africa's export arm. There will also be the transfer of production processes, technology and staff as well as new appointments to the board. Production changes are expected. Further investments in tooling and equipment will be made. One factor which might have stymied the deal was a possible clash between Fiat and Nissan in view of their joint SA manufacturing facility. Neither company has a similar relationship outside South Africa. Nissan, however, has welcomed the tie-up, while Fiat has also accepted the deal. A result of this will be the introduction of a Fiat Palio model to replace the Uno. "We could prove to be the matchmaker for bigger global ties between the two groups," says Newbury. The NMC deal is seen as a suitable response to the recent agreement in which Toyota Japan acquired a 27.8% interest in Toyota SA and the purchase by Ford of a 45% stake in Samcor. Toyota this week announced a R1.7-billion, four-year investment plan for two new models. Delta is now the only manufacturer with no direct financial link to its supplier. Documents relating to the de-listing will be posted to shareholders on Friday. They will contain interim results for the six months to December. Newbury will not reveal details of the results, but concedes that had they been good, the plan to de-list might not have been rushed through.
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