Nissan shares fell 6% on Tuesday after Nissan's second-largest shareholder, Mercedes-Benz, sold its entire 3.8% stake in the struggling Japanese automaker, UNN reports with reference to the Financial Times.
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The German automaker said its pension fund would sell shares worth about $346 million, increasing pressure on Nissan as the company struggles to implement its recovery plan.
The sale of the stake on Monday came amid a restructuring by Ivan Espinosa, who took over as CEO in April, which cut costs by 500 billion yen ($3.4 billion) by eliminating 20,000 jobs, closing factories, and selling real estate.
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Both companies merged in 2010 under former Nissan head Carlos Ghosn. This happened after the 2008 financial crisis, when automakers formed alliances in an attempt to reduce development and production costs.
Nissan's stock price rose after US President Donald Trump pledged in July to lower tariffs on car imports from Japan from 27.5% to 15%. Nevertheless, the company's market capitalization is still below $10 billion, and the stock price has fallen by 28% since the beginning of the year.
The Japanese automaker recorded a negative free cash flow of 390.5 billion yen in the first quarter of the current fiscal year and suspended its annual forecast.
According to MarkLines, whose data has been collected since 2004, with the growing popularity of Chinese electric vehicle manufacturers, Nissan has for the first time dropped out of the top ten largest automakers by sales volume in the first six months of the year.
Late last year, the Yokohama-based group was in talks to merge with Honda, but they fell through within months as the Japanese competitor sought full control of the combined company.
Nissan's largest shareholder and long-time Alliance partner, Renault, is also looking to sell part of its 36% stake.
Talks about a merger with Honda began after Taiwanese iPhone supplier Foxconn approached Renault with an offer to buy its stake in Nissan, as the company seeks to enter contract manufacturing of electric vehicles.
Mercedes-Benz said that Nissan shares no longer have strategic importance and were sold as part of a portfolio cleanup. Nissan, which sold 1.5% of Mercedes shares in 2021, declined to comment.