Nissan Council votes unanimously to overthrow Ghosn as president



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The board of the Nissan Motor Co. voted unanimously to oust President Carlos Ghosn on Thursday after suspending the industry heavyweight clash, ushering in a period of uncertainty for his 19-year alliance with Renault.

The Japanese company said its board also voted for the removal of Greg Kelly – who, as Ghosn was arrested after allegations of financial misconduct – from his position as representative director.

The move, which leaves the post of vacant chairman, took place despite Renault's request to the Nissan board before its meeting postponed Ghosn's removal, sources close to the matter told Reuters.

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The Franco-Japanese alliance, extended in 2016 to include Japan's Mitsubishi Motors, was essentially hit by Ghosn's 64-year jail in Japan on Monday.

Ghosn had shaped the alliance and was pushing for a deeper partnership, potentially including a complete merger between Renault and Nissan at the request of the French government, despite strong reservations in the Japanese company.

Japanese prosecutors said that Ghosn and Kelly conspired to underestimate Ghosn's compensation at Nissan in five years from 2010, saying it was about half of the 10 billion yen ($ 88 million).

Shin Kukimoto, deputy public prosecutor for the Tokyo District Attorney's Office, said on Thursday that court approval had been received the day before to arrest Ghosn for ten days but he could not comment on whether he had admitted the charges.

Nissan executives have five seats on the nine-member board, Renault's loyalists have two seats, and the remaining two are held by non-affiliated external directors, a former bureaucrat and a racing driver.

With Ghosn and Kelly still in detention, neither man was able to vote or defend himself at the meeting.

Renault refrained from dismissing Ghosn as president and CEO.

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But Mitsubishi Motors plans to remove Ghosn from its chairman post at a council meeting next week.

Amid growing uncertainty over the future of the alliance, Japan's industry minister and France's finance minister are expected to meet in Paris on Thursday to seek ways to stabilize it.

"For me, the future of the alliance is the biggest deal," a senior Nissan official told reporters on Wednesday when asked about Ghosn's arrest. "It's obvious that at this age we need to do things together. Going away would be impossible.

Prohibiting the Outdoors

Nissan said on Monday that an internal investigation triggered by a report by an informant revealed that Ghosn had engaged in irregularities, including his own personal use of money and under reporting his earnings for years.

Ghosn and Kelly did not comment on the allegations and Reuters was unable to reach them.

Prosecutors have said that Ghosn is being held at the Tokyo detention center, known for his austere regime, far from his usual luxury lifestyle, including restrictions on daytime sleep and the requirement to wear a mask when he encounters visitors to prevent spread of the disease.

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The detention house "is quite cold this year," internet entrepreneur and fraudster Takufumi Horie told his followers on Twitter.

Motonari Otsuru, a former public prosecutor who is known for overseeing the case against Horie, was hired as Ghosn's lawyer, NHK reported. Otsuru's law firm refused to confirm that he represented Ghosn and said no one was available to comment.

The Asahi Shimbun said on Thursday, citing unidentified sources, that Ghosn had given Kelly email orders to make false statements about his pay. Tokyo prosecutors have probably seized related e-mails and may use them as evidence, according to the report.

Yomiuri, Japan's largest daily, quoted anonymous sources as saying that Nissan's internal investigation found that Ghosn since 2002 has instructed around $ 100,000 a year to be paid to his older sister as compensation for a nonexistent consultative role.

The newspaper said that Nissan discovered through the investigation that Ghosn's sister was living and managing a luxury apartment in Rio de Janeiro that the company had bought through a subsidiary abroad, but did not do any consulting work for the automaker. Nissan shared the information with prosecutors, the Yomiuri said.

Shares of Nissan closed up 0.8%, in line with a broader market, ahead of the board meeting.

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Nissan holds a board meeting to oust President Carlos Ghosn after the suspension of his once-revered leader, sparking what could be a long period of uncertainty in his 19-year alliance with Renault. Reuters

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