PARIS -- Renault's board postponed a decision on Fiat Chrysler Automobiles' proposed merger, extending discussions for a second day after its partner Nissan put up resistance to the deal.
Renault directors decided to continue to "study with interest the opportunity of such a combination and to extend the discussions," the company's board said Tuesday in a statement. Another meeting is scheduled for late Wednesday, it said.
The board is examining in detail a preliminary agreement on a merger hammered out over the past days, according to a person familiar with the matter.
The draft takes into account requests by the French state -- Renault's most powerful shareholder -- for guarantees on governance and jobs, said the person, who asked not to be identified discussing private deliberations.
Also being considered is a possible payout to Renault investors, potentially by reducing a planned 2.5 billion-euro ($2.8 billion) special dividend slated for FCA owners, people familiar with the matter said.
It's possible that a decision to move forward will be reached Wednesday, according to the people.
Fiat Chrysler's proposal last week for a 50-50 combination under a Dutch holding company is designed to help the carmakers add scale, share costs and boost resources for tackling an expensive shift to electrification and autonomous driving.
The deal would create the world's third-largest automaker.
Longtime Renault partner Nissan has withheld support, and while the Japanese company cannot block the deal, its two representatives on the French company's board can cast votes. While they are likely to abstain, according to people familiar with the matter, their opposition would be a symbolic blow to the FCA proposal.
Nissan opposition would also go against a French government demand that any Renault combination with FCA remain within the framework of the existing Franco-Japanese alliance.
Nissan CEO Hiroto Saikawa, muddied the waters Monday by saying the company needs to review the future of its two-decade alliance with
Renault, including contractual relationships, in light of the proposed FCA deal.
Nissan could use a strong presence in China, Japan and the rest of Asia, as well as its electric-car technology, as leverage.