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Renault to decide on merger talks with Fiat Chrysler

Agencies

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Paris: The board of French car giant Renault is expected to decide on Tuesday to begin merger talks with Fiat Chrysler which could create a new global giant spanning the United States, Europe and Japan.

US-Italian group Fiat Chrysler proposed a “merger of equals” with Renault last week, which has been welcomed by financial markets and has been given a conditional green light by the French government.

A merger would be “a real opportunity for the French auto industry,” Finance Minister Bruno Le Maire told AFP on Friday of a tie-up which would bring together the flagship brands as well as Alfa Romeo, Jeep, Maserati, Dacia and Lada.

 

After preliminary talks over the last week, Renault directors are set to meet on Tuesday and decide whether to enter into formal discussions, which most observers expect it to do.

If combined, the two firms would produce 8.7 million vehicles a year, creating an industry powerhouse with an expected market value of some 36 billion euros ($40 billion).

But Renault already has an alliance with Japan’s Nissan and Mitsubishi, and the combined mega-group would be by far the world’s biggest, selling some 15 million vehicles, surpassing Volkswagen and Toyota, which sell around 10.6 million each.

Nissan, a long-time Renault partner, fears being sidelined by the deal and its chief executive, Hiroto Saikawa, warned Monday that a merger “would significantly alter the structure of our partner.”

Any new combination would require a “fundamental review” of their relationship, said the boss of Nissan, whose 15 percent stake in Renault would be diluted to 7.5 percent under the proposed deal.

Behind the scenes at the Yokohama-based firm, some executives believe the merger talks could further strain relations with Renault, which have been hit by the arrest in Japan of former CEO Carlos Ghosn, the architect of their alliance.

“It’s an ill thought-out and badly conceived plan,” one source close to Nissan told AFP last week on condition of anonymity.

Renault board chairman Jean-Dominique Senard travelled to Tokyo last week to attempt to smooth over ties in what has been a sometimes tricky marriage between the two partners over the last two decades.

But others believe there could be synergies between a combined mega-group because of Chrysler’s strong presence in the North American markets, where Renault and the Japanese firms are relatively weak.

In return, Fiat Chrysler hope to benefit from Renault and Nissan’s cutting-edge technology for electric cars, which has made them a world leader.

Analysts see plenty of potential stumbling blocks, however, not least the weight and ultimate influence of Renault and Fiat Chrysler in what would supposedly be a “merger of equals” between the companies.

The French state, which is the biggest shareholder in Renault with a 15 percent stake, will be a key player in any negotiations.

Le Maire has set four conditions for a merger, including that no plants will be closed as part of the tie-up and that the Renault-Nissan alliance continues.

The government also wants the merged group to guarantee that it will take in a new EU-backed initiative to develop battery technology, part of efforts to compete with Chinese dominance in the sector.

It also wants “balanced corporate governance” at the future group, meaning that Renault is adequately represented on the board of the combined group.

Press reports have suggested that Fiat chairman John Elkann, a grandson of Fiat’s emblematic former president Gianni Agnelli, would be chairman after a merger, while Renault’s Thierry Bollore would be chief executive.

The new group would be headquartered in the Netherlands and its shares would be traded in Paris, Milan and New York.


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RBI asks banks to grout ATMs to wall, floor for security by September-end

Press Trust of India

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Mumbai: The Reserve Bank asked banks to ensure their ATMs are grouted to a wall, pillar, or floor by September-end, except those installed in high secured premises such as airports, to enhance security of the cash vending machines.

In 2016, the RBI had st up a Committee on Currency Movement (CCM) to review the entire gamut of security of treasure in transit.

Based on the recommendations of the panel, the central bank has now issued instructions aimed at mitigating risks in ATM operations and enhancing security.

 

As part of the security measures, all “ATMs shall be operated for cash replenishment only with digital One Time Combination (OTC) locks”.

Also, “All ATMs shall be grouted to a structure (wall, pillar, floor, etc.) by September 30, 2019, except for ATMs installed in highly secured premises such as airports, etc. which have adequate CCTV coverage and are guarded by state/central security personnel”.

Further, banks may also consider rolling out a comprehensive e-surveillance mechanism at the ATMs to ensure timely alerts and quick response, it said.

The new measures to be adopted by banks are in addition to the existing instructions, practices and guidance issued by the RBI and law enforcement agencies.

The RBI also warned the banks that non-adherence of timelines or non-observance of the instructions would attract regulatory action including levy of penalty.

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SBI refuses to disclose communication from RBI, govt on electoral bonds

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New Delhi: The State Bank of India has refused to disclose any communication it received from the government or the Reserve Bank of India on electoral bonds, terming it “personal information” and held in “fiduciary capacity”.

Responding to an RTI filed by Pune-based activist Vihar Durve who had demanded copies of all letters, correspondence, directions, notifications or e-mails received from the RBI or any government department between 2017 and 2019, the SBI said it cannot be provided by it.

The bank cited two exemption clauses under the RTI Act to deny information — Section 8(1)(e) which pertains to information held in fiduciary capacity and Section 8(1)(J) which pertains to personal information of a person which has no link to any public activity.

 

“Information sought by the applicant cannot be disclosed as it is in fiduciary capacity, disclosure of which is exempted under Section 8(1)(e) and 8(1)(j) of the RTI Act, 2005,” the Central Public Information Officer of the bank said in his reply.

The bank also refused to give any details of action taken by it on such communications from the RBI and the government.

The electoral bonds, for giving donations to political parties, are being sold through SBI only. The sale opens in SBI branches when the Finance Ministry issues a notification of their sale for a given period.

The scheme of electoral bonds notified by the Centre in 2018 has been challenged in the Supreme Court.

Only the political parties registered under Section 29A of the Representation of the People Act, 1951 (43 of 1951) and which secured not less than one per cent of the votes polled in the last general election to the House of the People or the Legislative Assembly of the State, shall be eligible to receive the bonds.

The bonds may be purchased by a person who is a citizen of India “or incorporated or established in India,” the government had said in a statement last year.

The bonds remain valid for 15 days and can be encashed by an eligible political party only through an account with the authorised bank within that period only.

A voluntary group working in the field of electoral reforms, Association for Democratic Reforms (ADR), has demanded a stay on the sale while the CPI(M) has challenged it before the Supreme Court in separate petitions.

ADR recently filed an application in the Supreme Court seeking a stay on the Electoral Bond Scheme, 2018 which was notified by the Centre in January last year.

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Walmart’s Flipkart, Indian startup GOQii settle dispute over sharp discounting

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New Delhi: Walmart unit Flipkart has settled a legal dispute with an Indian startup that alleged it suffered losses because its products were sharply discounted on the global retailer’s website.

GOQii, a seller of smartwatch-type health devices, sued Flipkart last month in a Mumbai court, alleging its devices were discounted by around 70 per cent to the retail price, much more than the two sides had agreed. The court had, as an interim measure, ordered device sales to be halted on Flipkart.

In a joint statement , the companies said the dispute had been resolved and GOQii health devices would again be available on Flipkart. They didn’t say how the settlement was reached.

 

Vishal Gondal, CEO of GOQii, told Reuters the company would withdraw the case against Flipkart. The e-commerce retailer’s “team worked on a resolution benefitting the brand and the customers”, Gondal said in the statement.

The legal spat was seen as a test case of the giant retailer’s operating strategy in the country.

Small traders and a right-wing group close to Prime Minister Narendra Modi’s ruling party have raised concerns about large e-commerce companies, saying they burn billions of dollars deeply discounting some products to lure customers onto their sites, in the expectation that they will also buy other goods.

GOQii said it signed an agreement last year with a Flipkart unit to sell two of its devices at a price not below 1,999 rupees (USD 28.63) and 1,499 rupees. It later found the devices were being sold for 999 rupees and 699 rupees, calling it “unauthorized” discounting.

In response, Flipkart said it reserved “the right to institute actions for defamation, both civil and criminal”, arguing it wasn’t responsible for any discounts which are determined by third-party firms which sell via its website.

The two companies struck a friendlier tone in their joint-statement on Friday as they brought the legal battle to an end.

“We have ensured constant engagement with GOQii to resolve any differences,” Flipkart said in the statement.

With a 19 per cent market share, GOQii was the second-biggest player in India’s so-called wearables market last year, data from industry tracker IDC showed. The market is dominated by China’s Xiaomi, with Samsung a small player.

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