A man walks past the Nissan Motor Co. displayed at the company’s headquarters in Yokohama, Japan. (Photographer: Keith Bedford/Bloomberg)

Nissan Board Divided Over Plan to Dismiss Carlos Ghosn

(Bloomberg) -- With less than 24 hours to go before Nissan Motor Co.’s vote on whether to dismiss Carlos Ghosn as chairman, board members are divided, saying they have been given too little detail on his alleged financial crimes, according to people familiar with the matter.

The nine-member board is due to vote Thursday afternoon Japan time on the motion to dismiss Ghosn, who was arrested on Monday after stepping off a jet at a Tokyo airport. Renault SA, Nissan’s biggest shareholder and partner in the world’s biggest auto alliance, has said it’s awaiting more details of the allegations and has installed an interim chief executive officer in place of Ghosn.

Nissan Board Divided Over Plan to Dismiss Carlos Ghosn

The debate at the top of Nissan adds another layer of complexity to a saga that’s rippling through the powerful alliance. Japanese authorities shocked the world when they arrested Ghosn on Monday, catching Renault and the French government flat footed, and fueling speculation about whether Ghosn was ousted in a palace coup.

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Nissan CEO Hiroto Saikawa said Monday that a months-long probe found Ghosn had under-reported income and misused Nissan company funds. In a heated press conference, Saikawa said the actions meant Nissan would move to dismiss Ghosn, the brains behind the carmaker’s alliance with Renault and Mitsubishi Motors Corp. A Nissan director, American Greg Kelly, has also been accused of wrongdoing in relation to Ghosn’s pay.

Nissan Board Divided Over Plan to Dismiss Carlos Ghosn

But one of Nissan’s directors told Bloomberg News that not enough information had been provided about the investigation for them to be able to decide how to vote on Thursday. Securing a unanimous decision to oust Ghosn as chair will likely be difficult because Nissan directors that used to work at Renault may not back the dismissal until the allegations against Ghosn are made clear, according to people familiar with board members’ deliberations.

The director and other people Bloomberg News spoke to asked not to be named, citing company policy.

The board’s decision Thursday will do little to clear the allegations against Ghosn and Kelly that are still being pursued by the Tokyo prosecutor’s office. The men will be detained for a further 10 days, Japanese broadcaster NHK said on Wednesday.

A Nissan spokesman didn’t comment specifically on the board deliberations.

“The directors are meeting tomorrow and a proposal will be made to the board to remove the directorships of Mr Ghosn and Mr Kelly,” the spokesman said.

Hard Line

Nissan’s board currently includes Ghosn, Saikawa and Kelly as three representative members. It also has two external board members. The directors present in the meeting will vote anonymously on a one-person-one-vote basis, and the outcome will be determined by a simple majority, according to two people briefed on the matter. That means there needs to be at least four votes in favor for the motion to be carried. The board won’t name any new members to replace Ghosn and Kelly, according to the people.

While Nissan under Saikawa has taken a hard line on Ghosn’s arrest, Renault’s board stopped short of firing him as CEO at an emergency meeting in Paris Tuesday night. They’ve asked Nissan to hand over details of Ghosn’s alleged misdeeds.

Ghosn and Kelly were taken away by prosecutors when they arrived in Tokyo Monday on a corporate jet, according to the Asahi Shimbun newspaper.The exact whereabouts of Ghosn and Kelly aren’t known and they or their representatives couldn’t be reached for comment.

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