Samsung Elec says it will cancel $4.4 billion worth of shares

SEOUL (Reuters) – Samsung Electronics Co Ltd (005930.KS) said on Friday it would cancel 4.9 trillion won ($4.4 billion) worth of its shares.

Expected to be complete on Dec. 4, the cancellation was the second stage of its previously announced plan to cancel all of its treasury shares in two stages to enhance shareholder value. The first stage was canceled in May last year, it said.

The South Korean tech giant last year rejected pressure from U.S. activist hedge fund Elliott for a major overhaul of its complicated structure, but accepted part of the fund’s proposals by revealing plans to cancel its existing treasury shares by 2018.

The cancellation announced on Friday included 450 million in common stock and 81 million in preferred stock, the company said in a filing to the stock exchange.

Samsung Electronics shares were flat at 0101 GMT, in line with the wider market .KS11. The stock has fallen 15 percent this year amid memory chip price weakness after a two-year boom.

“Samsung Electronics will continue to build a sustainable growth base by increasing competitiveness and to enhance shareholder value through active shareholder returns,” the company said in a statement.

($1 = 1,119.1800 won)

Reporting by Ju-min Park; Editing by Stephen Coates

Samsung Elec says it will cancel $4.4 billion worth of shares

SEOUL (Reuters) – Samsung Electronics Co Ltd (005930.KS) said on Friday it would cancel 4.9 trillion won ($4.4 billion) worth of its shares.

Expected to be complete on Dec. 4, the cancellation was the second stage of its previously announced plan to cancel all of its treasury shares in two stages to enhance shareholder value. The first stage was canceled in May last year, it said.

The South Korean tech giant last year rejected pressure from U.S. activist hedge fund Elliott for a major overhaul of its complicated structure, but accepted part of the fund’s proposals by revealing plans to cancel its existing treasury shares by 2018.

The cancellation announced on Friday included 450 million in common stock and 81 million in preferred stock, the company said in a filing to the stock exchange.

Samsung Electronics shares were flat at 0101 GMT, in line with the wider market .KS11. The stock has fallen 15 percent this year amid memory chip price weakness after a two-year boom.

“Samsung Electronics will continue to build a sustainable growth base by increasing competitiveness and to enhance shareholder value through active shareholder returns,” the company said in a statement.

($1 = 1,119.1800 won)

Reporting by Ju-min Park; Editing by Stephen Coates

Financial wrongdoing allegations against Carlos Ghosn

(This Nov. 26 story, corrects date and clarifies condition of deadline by which authorities must file charges against Ghosn or let him go, in first paragraph)

TOKYO (Reuters) – Carlos Ghosn, the ousted chairman of Japan’s Nissan Motor Co, is being held in Tokyo’s main detention center after allegations against him of financial misconduct. If prosecutors seek a maximum 10-day extension of Ghosn’s detention, and the court approves, Japanese authorities will have to file charges by Dec. 10 or let him go.

The compensation packages for Ghosn, one of the most celebrated and well-paid leaders in the global auto industry, have been a sore point among investors of the Renault-Nissan alliance which he helped launch in 1999.

The scandal comes just five months after Ghosn, 64, narrowly won a shareholder vote at Renault over his 7.4 million euro pay package for 2017. He had lost the vote in 2016.

The following are allegations made by Nissan and the media. There has been no public comment from Ghosn on the allegations, and Reuters could not contact him or his lawyers for comments.

UNDER-REPORTED EARNINGS

Japanese prosecutors allege Ghosn and fellow board member Greg Kelly, who is also being held for questioning, conspired to under-report by about half the 10 billion yen ($88 million) Ghosn earned at Nissan over five years from fiscal 2010 in filings to the Tokyo Stock Exchange.

Nissan declined to give further details about the under-reporting, but the Nikkei business daily, citing unidentified sources, said Ghosn had received share price-linked compensation of about 4 billion yen over a five-year period to March 2015 and it went unreported in Nissan’s financial reports.

The financial reports also did not mention annual compensation of 100 million to 150 million yen Ghosn received from the automaker’s overseas subsidiaries, the newspaper said.

The Wall Street Journal reported, citing people familiar with the investigation, that Ghosn earned 8 billion yen in what Nissan calls unreported deferred compensation in the eight years that ended in March 2018.

The structure was formulated in consultation with Kelly, and Ghosn told colleagues that if he was set to receive the deferred money after retirement, it wouldn’t have to be reported in Japanese regulatory filings, the report said.

The Asahi newspaper also reported, without citing sources, that Ghosn had understated his remuneration at Nissan by around 8 billion yen in the eight years through the fiscal year that ended in March, including 3 billion yen over the last three fiscal years.

MISAPPROPRIATION OF FUNDS

Nissan Chief Executive Hiroto Saikawa said last week that a months-long internal investigation had also uncovered evidence that Ghosn used company funds for personal purposes and misrepresented the company’s investments.

Japanese public broadcaster NHK reported Nissan paid billions of yen for the purchase and renovation of homes for Ghosn in Rio de Janeiro, Beirut, Paris and Amsterdam, citing unnamed sources. The properties had no business purpose and were not listed as benefits in filings to the Tokyo bourse, it said.

The Nikkei last week reported that Nissan through a British Virgin Island unit of a Dutch venture fund subsidiary bought and renovated homes for Ghosn in Brazil and Lebanon worth around $18 million.

Nissan, the report added, also paid several hundred thousand dollars for Ghosn’s family vacations.

The Yomiuri, Japan’s biggest-circulation daily, said Nissan had been paying Ghosn’s elder sister $100,000 a year since 2002 for a non-existent advisory role. She lived in a luxury Rio de Janeiro apartment funded by a Nissan subsidiary, according to the report, which cited unidentified sources.

REPORTED DENIAL

Japanese media reported that Ghosn and Kelly have denied allegations against them, claiming that part of Ghosn’s compensation had been put aside until he left the company and therefore was not subject to disclosure.

NHK said that Kelly told investigators that he had discussed the plan with other executives at Nissan.

Ghosn has yet to make any statement through his lawyers, while The Tokyo District Public Prosecutors remains tight-lipped about what they intend to do with the former Nissan chief and his colleague.

French Finance Minister Bruno Le Maire weighed in on Sunday saying he had yet to see evidence to support allegations of wrongdoing.

($1 = 113.1900 yen)

Reporting Tim Kelly; Editing by Miyoung Kim and Muralikumar Anantharaman

Financial wrongdoing allegations against Carlos Ghosn

(This Nov. 26 story, corrects date and clarifies condition of deadline by which authorities must file charges against Ghosn or let him go, in first paragraph)

TOKYO (Reuters) – Carlos Ghosn, the ousted chairman of Japan’s Nissan Motor Co, is being held in Tokyo’s main detention center after allegations against him of financial misconduct. If prosecutors seek a maximum 10-day extension of Ghosn’s detention, and the court approves, Japanese authorities will have to file charges by Dec. 10 or let him go.

The compensation packages for Ghosn, one of the most celebrated and well-paid leaders in the global auto industry, have been a sore point among investors of the Renault-Nissan alliance which he helped launch in 1999.

The scandal comes just five months after Ghosn, 64, narrowly won a shareholder vote at Renault over his 7.4 million euro pay package for 2017. He had lost the vote in 2016.

The following are allegations made by Nissan and the media. There has been no public comment from Ghosn on the allegations, and Reuters could not contact him or his lawyers for comments.

UNDER-REPORTED EARNINGS

Japanese prosecutors allege Ghosn and fellow board member Greg Kelly, who is also being held for questioning, conspired to under-report by about half the 10 billion yen ($88 million) Ghosn earned at Nissan over five years from fiscal 2010 in filings to the Tokyo Stock Exchange.

Nissan declined to give further details about the under-reporting, but the Nikkei business daily, citing unidentified sources, said Ghosn had received share price-linked compensation of about 4 billion yen over a five-year period to March 2015 and it went unreported in Nissan’s financial reports.

The financial reports also did not mention annual compensation of 100 million to 150 million yen Ghosn received from the automaker’s overseas subsidiaries, the newspaper said.

The Wall Street Journal reported, citing people familiar with the investigation, that Ghosn earned 8 billion yen in what Nissan calls unreported deferred compensation in the eight years that ended in March 2018.

The structure was formulated in consultation with Kelly, and Ghosn told colleagues that if he was set to receive the deferred money after retirement, it wouldn’t have to be reported in Japanese regulatory filings, the report said.

The Asahi newspaper also reported, without citing sources, that Ghosn had understated his remuneration at Nissan by around 8 billion yen in the eight years through the fiscal year that ended in March, including 3 billion yen over the last three fiscal years.

MISAPPROPRIATION OF FUNDS

Nissan Chief Executive Hiroto Saikawa said last week that a months-long internal investigation had also uncovered evidence that Ghosn used company funds for personal purposes and misrepresented the company’s investments.

Japanese public broadcaster NHK reported Nissan paid billions of yen for the purchase and renovation of homes for Ghosn in Rio de Janeiro, Beirut, Paris and Amsterdam, citing unnamed sources. The properties had no business purpose and were not listed as benefits in filings to the Tokyo bourse, it said.

The Nikkei last week reported that Nissan through a British Virgin Island unit of a Dutch venture fund subsidiary bought and renovated homes for Ghosn in Brazil and Lebanon worth around $18 million.

Nissan, the report added, also paid several hundred thousand dollars for Ghosn’s family vacations.

The Yomiuri, Japan’s biggest-circulation daily, said Nissan had been paying Ghosn’s elder sister $100,000 a year since 2002 for a non-existent advisory role. She lived in a luxury Rio de Janeiro apartment funded by a Nissan subsidiary, according to the report, which cited unidentified sources.

REPORTED DENIAL

Japanese media reported that Ghosn and Kelly have denied allegations against them, claiming that part of Ghosn’s compensation had been put aside until he left the company and therefore was not subject to disclosure.

NHK said that Kelly told investigators that he had discussed the plan with other executives at Nissan.

Ghosn has yet to make any statement through his lawyers, while The Tokyo District Public Prosecutors remains tight-lipped about what they intend to do with the former Nissan chief and his colleague.

French Finance Minister Bruno Le Maire weighed in on Sunday saying he had yet to see evidence to support allegations of wrongdoing.

($1 = 113.1900 yen)

Reporting Tim Kelly; Editing by Miyoung Kim and Muralikumar Anantharaman

Mitsubishi Motors ousts Ghosn as chairman, days after Nissan firing

TOKYO (Reuters) – Mitsubishi Motors Corp said on Monday its board removed Carlos Ghosn from his role as chairman, following his arrest and ouster from alliance partner Nissan Motor Co last week for alleged financial misconduct.

Ghosn’s sacking in a unanimous board vote marks the end of his chairmanship of Japanese automakers, just two years after he was praised for bringing a steadying hand to Mitsubishi Motors following a cheating scandal in 2016. CEO Osamu Masuko will become temporary chairman, the automaker said.

“Ghosn has lost the confidence of Nissan” and it is “difficult for him to fulfill his duties”, spurring the dismissal, Mitsubishi Motors said in a statement. Nissan holds a controlling 34 percent stake in Mitsubishi Motors and has two executives on the board.

The move comes amid discontent over French partner Renault SA’s role in the 19-year Franco-Japanese alliance of which Ghosn was the driving force.

Sealed in 1999 when Nissan was rescued from near-bankruptcy, it was enlarged in 2016 to include Mitsubishi and enabled the members to jointly develop products and control costs. The alliance vies with Volkswagen AG (VOWG_p.DE) and Toyota Motor Corp for the ranking of the world’s biggest automaker.

Even as Nissan has recovered and grown rapidly, it remains a junior partner in the shareholding structure. Renault owns 43 percent of Nissan and the Japanese automaker holds a 15 percent non-voting stake in the French firm. And Nissan is almost 60 percent bigger than Renault by sales.

Top alliance executives are meeting this week in Amsterdam, aiming to shield their joint operations from the fallout of Ghosn’s arrest as a power struggle between Nissan and Renault looms. Renault has refrained from firing him as chairman and CEO.

  • Financial wrongdoing allegations against Carlos Ghosn

Mitsubishi Motors already had plans to discuss its position in the alliance with Ghosn and, following the ouster, it needs to consider focusing on regions and technology where it can retain competitiveness, CEO Masuko told reporters after the board meeting.

Cooperation among alliance members is needed amid the rise of new technology like automated and internet-connected vehicles, he said.

Nissan CEO Hiroto Saikawa told staff on Monday that power was too concentrated with Ghosn and that in future better communication between alliance board members and executives would help preserve independence and generate synergies among the automakers, a Nissan spokesman said.

Ghosn was pushing for a deeper tie-up, including potentially a full merger between Renault and Nissan at the French government’s urging, despite strong reservations at the Japanese firm.

Nissan removed Ghosn at a high-stakes board meeting on Thursday after alleging he understated his income and used company money for personal use.

Ghosn has denied the allegations, public broadcaster NHK reported on Sunday.

Mitsubishi Motors is conducting its own probe into potential wrongdoing by Ghosn, and plans to announce the results at its December board meeting.

Slideshow (9 Images)

While the automakers have stressed that operations and business are proceeding as normal, Nissan has postponed the launch of its high-performance Leaf electric car “to ensure that this important product unveiling could receive the coverage it merits”, a Nissan spokesman said.

Shares in Mitsubishi Motors closed up 3.3 percent ahead of the announcement while Nissan climbed 1.8 percent, outperforming the broader market’s 0.8 percent gain.

Reporting by Sam Nussey, Makiko Yamazaki and Chang-Ran Kim; Additional reporting by Maki Shiraki; Editing by Muralikumar Anantharaman

Mitsubishi Motors ousts Ghosn as chairman, days after Nissan firing

TOKYO (Reuters) – Mitsubishi Motors Corp said on Monday its board removed Carlos Ghosn from his role as chairman, following his arrest and ouster from alliance partner Nissan Motor Co last week for alleged financial misconduct.

Ghosn’s sacking in a unanimous board vote marks the end of his chairmanship of Japanese automakers, just two years after he was praised for bringing a steadying hand to Mitsubishi Motors following a cheating scandal in 2016. CEO Osamu Masuko will become temporary chairman, the automaker said.

“Ghosn has lost the confidence of Nissan” and it is “difficult for him to fulfill his duties”, spurring the dismissal, Mitsubishi Motors said in a statement. Nissan holds a controlling 34 percent stake in Mitsubishi Motors and has two executives on the board.

The move comes amid discontent over French partner Renault SA’s role in the 19-year Franco-Japanese alliance of which Ghosn was the driving force.

Sealed in 1999 when Nissan was rescued from near-bankruptcy, it was enlarged in 2016 to include Mitsubishi and enabled the members to jointly develop products and control costs. The alliance vies with Volkswagen AG (VOWG_p.DE) and Toyota Motor Corp for the ranking of the world’s biggest automaker.

Even as Nissan has recovered and grown rapidly, it remains a junior partner in the shareholding structure. Renault owns 43 percent of Nissan and the Japanese automaker holds a 15 percent non-voting stake in the French firm. And Nissan is almost 60 percent bigger than Renault by sales.

Top alliance executives are meeting this week in Amsterdam, aiming to shield their joint operations from the fallout of Ghosn’s arrest as a power struggle between Nissan and Renault looms. Renault has refrained from firing him as chairman and CEO.

  • Financial wrongdoing allegations against Carlos Ghosn

Mitsubishi Motors already had plans to discuss its position in the alliance with Ghosn and, following the ouster, it needs to consider focusing on regions and technology where it can retain competitiveness, CEO Masuko told reporters after the board meeting.

Cooperation among alliance members is needed amid the rise of new technology like automated and internet-connected vehicles, he said.

Nissan CEO Hiroto Saikawa told staff on Monday that power was too concentrated with Ghosn and that in future better communication between alliance board members and executives would help preserve independence and generate synergies among the automakers, a Nissan spokesman said.

Ghosn was pushing for a deeper tie-up, including potentially a full merger between Renault and Nissan at the French government’s urging, despite strong reservations at the Japanese firm.

Nissan removed Ghosn at a high-stakes board meeting on Thursday after alleging he understated his income and used company money for personal use.

Ghosn has denied the allegations, public broadcaster NHK reported on Sunday.

Mitsubishi Motors is conducting its own probe into potential wrongdoing by Ghosn, and plans to announce the results at its December board meeting.

Slideshow (9 Images)

While the automakers have stressed that operations and business are proceeding as normal, Nissan has postponed the launch of its high-performance Leaf electric car “to ensure that this important product unveiling could receive the coverage it merits”, a Nissan spokesman said.

Shares in Mitsubishi Motors closed up 3.3 percent ahead of the announcement while Nissan climbed 1.8 percent, outperforming the broader market’s 0.8 percent gain.

Reporting by Sam Nussey, Makiko Yamazaki and Chang-Ran Kim; Additional reporting by Maki Shiraki; Editing by Muralikumar Anantharaman

Japan says no decision yet on whether Abe, Macron will meet at G20

TOKYO (Reuters) – No meeting has been set yet between Japanese Prime Minister Shinzo Abe and his French counterpart, a Japan’s government spokesman said, after media reported that President Emmanuel Macron had requested a meeting to discuss the Nissan-Renault alliance.

Abe and Macron will both attend a G20 summit meeting in Buenos Aires starting on Friday.

At a news conference, Japanese Deputy Chief Cabinet Secretary Yasutoshi Nishimura said on Friday it was important for Nissan Motor Co (7201.T) and Renault SA (RENA.PA) to maintain a stable alliance.

The two companies, along with third partner Mitsubishi Motors Corp (7211.T), vowed on Thursday to stick by their industrial alliance but failed to name an interim boss to stand in for Chairman Carlos Ghosn, whose arrest has threatened the French car maker’s control of the partnership.

Reporting by Kaori Kaneko; Editing by Chang-Ran Kim

Japan says no decision yet on whether Abe, Macron will meet at G20

TOKYO (Reuters) – No meeting has been set yet between Japanese Prime Minister Shinzo Abe and his French counterpart, a Japan’s government spokesman said, after media reported that President Emmanuel Macron had requested a meeting to discuss the Nissan-Renault alliance.

Abe and Macron will both attend a G20 summit meeting in Buenos Aires starting on Friday.

At a news conference, Japanese Deputy Chief Cabinet Secretary Yasutoshi Nishimura said on Friday it was important for Nissan Motor Co (7201.T) and Renault SA (RENA.PA) to maintain a stable alliance.

The two companies, along with third partner Mitsubishi Motors Corp (7211.T), vowed on Thursday to stick by their industrial alliance but failed to name an interim boss to stand in for Chairman Carlos Ghosn, whose arrest has threatened the French car maker’s control of the partnership.

Reporting by Kaori Kaneko; Editing by Chang-Ran Kim

Nio, China rival to Tesla, says U.S. head to step down

SHANGHAI (Reuters) – The U.S. head of Nio Inc, an electric carmaker seen as one of the main Chinese rivals to Tesla Inc, will leave the company, the firm said in a filing on Friday, the first major management departure since its September IPO.

Padmasree Warrior, chief executive officer of NIO USA and global chief development officer, will resign from her posts on Dec. 17 for “personal interests”, the company said.

Warrior joined Nio, previously called NextEV, in 2015, and led the company along with founder and CEO William Li to become one of China’s most legitimate challengers in the global race to develop electric vehicles.

Before joining Nio, Warrior was chief technology and strategy officer at Cisco Systems Inc and chief technology officer at Motorola.

China is the world’s largest and fast-growing market for new-energy vehicles (NEVs), a category comprising electric battery cars and plug-in electric hybrids.

NEV sales in the first 10 months of 2018 came in at 860,000 vehicles, up 75.6 percent year-on-year.

Competition is, however, rising as Beijing looks to rein in subsidies that led to a huge array of EV contenders entering the market. Some of those are now being weeded out.

Tesla itself is building a car manufacturing plant in Shanghai to bolster its presence in the market and reduce its prices to become more competitive.

Nio’s shares – up strongly this year on robust revenue growth and bullish views from some analysts – dropped more than 4 percent in U.S. trading on Thursday.

Reporting by Adam Jourdan and Yilei Sun, Editing by Sherry Jacob-Phillips

Nio, China rival to Tesla, says U.S. head to step down

SHANGHAI (Reuters) – The U.S. head of Nio Inc, an electric carmaker seen as one of the main Chinese rivals to Tesla Inc, will leave the company, the firm said in a filing on Friday, the first major management departure since its September IPO.

Padmasree Warrior, chief executive officer of NIO USA and global chief development officer, will resign from her posts on Dec. 17 for “personal interests”, the company said.

Warrior joined Nio, previously called NextEV, in 2015, and led the company along with founder and CEO William Li to become one of China’s most legitimate challengers in the global race to develop electric vehicles.

Before joining Nio, Warrior was chief technology and strategy officer at Cisco Systems Inc and chief technology officer at Motorola.

China is the world’s largest and fast-growing market for new-energy vehicles (NEVs), a category comprising electric battery cars and plug-in electric hybrids.

NEV sales in the first 10 months of 2018 came in at 860,000 vehicles, up 75.6 percent year-on-year.

Competition is, however, rising as Beijing looks to rein in subsidies that led to a huge array of EV contenders entering the market. Some of those are now being weeded out.

Tesla itself is building a car manufacturing plant in Shanghai to bolster its presence in the market and reduce its prices to become more competitive.

Nio’s shares – up strongly this year on robust revenue growth and bullish views from some analysts – dropped more than 4 percent in U.S. trading on Thursday.

Reporting by Adam Jourdan and Yilei Sun, Editing by Sherry Jacob-Phillips