PARIS (Reuters) -- The French government has completed steps to increase its stake in Renault despite opposition from the company's alliance partner, Nissan, and Carlos Ghosn, who heads both automakers.
The government has boosted its Renault stake to 19.74 percent from 15.01 percent in a move aimed at giving the state enough voting power to block Ghosn's plan for Renault to opt out of the so-called Florange law introduced under French President Francois Hollande that doubles the voting rights of shares held for more than two years in companies.
Renault's proposed opt-out will be decided at the company's April 30 annual shareholder meeting.
Ghosn and Nissan, which holds a 15 percent stake in Renault, oppose increased state influence in the French automaker. They want to keep the current one-share, one-vote capital structure.
Ghosn on April 16 demanded that the state back away from its plans, but the government's near 20 percent holding is seen as likely to be enough to leave Renault's management short of the two-thirds vote it needs. This is based on the usual level of turnout at Renault annual meetings and on the fact that Nissan's 15 percent carries no voting rights.
In a statement today, the state investment holding APE repeated the government's position that it would be careful not to upset the shareholder "balance" within the group.
"This operation marks both the government's determination to defend its interests as a shareholder by installing double voting rights in Renault governance and the strategic nature of its holding in this great industrial company," the APE said.
The government has said it will reduce its stake after the annual meeting.
Ghosn has said that Nissan's management would be discussing what to do about the issue this week. The Renault board last week issued a statement that said the alliance's "survival and success" required the restoration of the previous balance between France and Nissan.