Investing.com-- Nissan (OTC:NSANY) Motor (TYO:7201) shares rose on Friday following reports that the automaker is preparing to withdraw from merger talks with Honda (NYSE:HMC) Motor (TYO:7267), potentially reopening the door for a partnership with Taiwan’s Hon Hai Precision Industry (TW:2317), popularly known as Foxconn (SS:601138).
Nissan’s stock climbed 5% to 435 yen on Friday after a Reuters report stated that CEO Makoto Uchida informed Honda’s CEO, Toshihiro Mibe, of the decision to terminate merger discussions.
The talks had stalled due to disagreements, including Honda’s proposal to make Nissan a subsidiary, which deviated from the initial plan of a merger of equals, Japanese public broadcaster NHK reported.
Honda’s shares fell by nearly 1% following the news, reflecting investor concerns over the failed merger.
The potential merger aimed to create the world’s third-largest automaker, but differences between the companies, such as market value and production operations, led to complications, the reports stated.
Nissan is now exploring partnerships beyond the automotive sector, including with technology firms like Foxconn, according to the Reuters report.
Foxconn had previously expressed interest in Nissan but paused its pursuit amid the Honda merger discussions.
With the merger talks now faltering, reports suggest that Foxconn may renew its interest in collaborating with Nissan, particularly in the electric vehicle sector.