Daimler's pension fund gets 1.8-billion-euro Renault Nissan stake
Reuters
Published Jun 29, 2016 11:11AM ET
Daimler's pension fund gets 1.8-billion-euro Renault Nissan stake
FRANKFURT (Reuters) - Carmaker Daimler (DE:DAIGn) on Wednesday topped up its German pension scheme by transferring a stake in Renault SA (PA:RENA) and Nissan Motor Co (T:7201) worth about 1.8 billion euros ($2 billion) to the fund.
Companies are having to look for ways to cope with pension liabilities which have ballooned because low central bank interest rates have cut investment returns, creating funding gaps in many pension schemes.
"With this contribution we are again reinforcing our pension assets," Daimler Chief Executive Dieter Zetsche said. "Our aim in this is to safeguard our employees' pension benefits for the long term.
"Regardless of the share transfer we will continue the successful strategic alliance with the Renault/Nissan Alliance."
Daimler said the transfer would result in a one-time positive impact to its 2016 earnings before interest and taxes (EBIT) of about 0.5 billon euros.
The German carmaker has already topped up its German pension fund to help to meet long-term payout obligations. It made a 1 billion euros contribution in December 2015, and a 2.5 billion euros payment in 2014.
Daimler acquired 3.1 percent in the share capital of Renault and Nissan in 2010 as part of a reciprocal investment to accompany a strategic partnership for sharing engines, platforms and manufacturing facilities between Renault Nissan and Daimler.
Earlier this year, Daimler expressed concerns about the French government's attempts to increase its voting rights in the French carmaker because of a divergence from the "one share one vote principle."
The French government, which recently increased its stake in Renault, proposed introducing a law to grant double voting rights to long term-shareholders.
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Written By: Reuters
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