Fiat Chrysler Automobiles has retracted its offer to merge with Renault a week after submitting the offer because Nissan declined to support it, according to reports.
Two Renault board members representing Nissan were opposed to the deal, and the French government had asked the automaker to "postpone the vote," the Wall Street Journal reported. Nissan holds a 15% stake in Renault, and Renault holds a 43.3% stake in Nissan. The companies, along with Mitsubishi, have been operating under an alliance designed to share costs and create greater efficiency.
In a statement released late Wednesday, FCA blamed the French government for the collapse of merger talks.
"FCA remains firmly convinced of the compelling, transformational rationale of a proposal that has been widely appreciated since it was submitted, the structure and terms of which were carefully balanced to deliver substantial benefits to all parties," according to the company. "However it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully."
FCA proposed the merger on Memorial Day, and promised more than $5.6 billion in annual costs savings. FCA and Renault would have become the world's third largest automaker with an estimated $8.7 million in annual sales.
Following the move, FCA said it would continue operating with an "independent strategy."
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