The two carmakers have agreed to cooperate in areas including purchasing, common vehicle platforms, technology sharing, joint plant activity and growth markets.
The transaction is subject to the signing of a definitive Alliance Agreement, which is expected by the end of May.
"This is a breakthrough transaction and a win-win for both Nissan and Mitsubishi Motors,” said Carlos Ghosn, CEO and president of Nissan (pictured). “It creates a dynamic new force in the automotive industry that will cooperate intensively and generate sizeable synergies. We will be the largest shareholder of MMC, respecting their brand, their history and boosting their growth prospects. We will support MMC as they address their challenges and welcome them as the newest member of our enlarged Alliance family.”
Mitsubishi's biggest single shareholder at the moment is Mitsubishi Heavy Industries (MHI), which owns around 20% of the company. That is followed by Mitsubishi Corporation (10%) and the Bank of Tokyo-Mitsubishi UFJ (4%).
Nissan set up a minicar development and manufacturing joint venture called NMKV in Japan with Mitsubishi back in June 2011.
According to Paul Newton, director, world markets analysis at IHS Automotive, the deal is expected to bolster economies of scale and create synergies in areas including platform sharing, SUVs and pick-up trucks.
The signing of this latest agreement with Mitsubishi expands Nissan’s alliance strategy. Along with its well-established arrangement with Renault, the carmaker has partnerships with Daimler and Avtovaz, among others.
A Nissan spokesperson said it could not comment on the implications of the new arrangement for network cost savings or the impact it would have on the supply chain and procurement of parts and materials until the memorandum of understanding was finalised.