Honda asks Nissan to become subsidiary

TOKYO, Feb. 4 — Honda Motor Co. has proposed a plan to buy shares in Nissan Motor Co. to make it a subsidiary, people familiar with the matter said Tuesday.

Honda apparently aims to increase its involvement in Nissan’s management to help accelerate its turnaround efforts.

It is, however, unclear whether the proposal will be accepted by Nissan, which is strongly opposed to Honda taking control of its management.

READ: Nissan, Honda to attempt a merger to be world’s No. 3 automaker

In December, the two Japanese automakers said that they would start talks on establishing a holding company to merge their operations.

However, Nissan has been struggling to compile a restructuring plan, a move that Honda sees as necessary to go ahead with their merger.

At a press conference in December, when the agreement to start the merger talks was announced, Nissan President and CEO Makoto Uchida stressed that any deal would be a merger of equals.

A Nissan executive expressed displeasure about the proposal for Nissan to become a Honda subsidiary, saying, “There can be no other option than what was agreed in December last year.”

The two companies are expected to outline the direction of their merger talks in mid-February after examining progress on Nissan’s restructuring efforts.

Through the merger, the two companies aim to become a globally competitive automaker by deepening cooperation in areas including electric vehicle development.

As the talks are progressing, however, clear differences between the two sides have emerged.