‘Outrageous Monster’: Nissan Shareholders Vent, Cut Final Tie With Ghosn - The Wall Street Journal

Former Nissan Chairman Carlos Ghosn leaving his lawyer's office in Tokyo in March. Photo: kazuhiro nogi/Agence France-Presse/Getty Images

Sean McLain

The Wall Street Journal

Biography
@McLainSean
sean.mclain@wsj.com

Updated April 8, 2019 7:46 a.m. ET

TOKYO—Some Nissan Motor Co. NSANY -0.24% shareholders called for the resignation of Chief Executive Hiroto Saikawa at a raucous meeting where the auto maker severed its last ties to longtime leader Carlos Ghosn.

The meeting was the first opportunity for shareholders to vent their concerns with management since Mr. Ghosn’s surprise arrest on Nov. 19. Many questioned Nissan’s assertion that top executives were unaware of the extent of Mr. Ghosn’s alleged wrongdoing, which includes a charge by prosecutors that he underreported his compensation for eight years.

“You found this out when he was arrested? You are disqualified for not being able to discover this,” said one shareholder.

Carlos Ghosn resigned as chairman and CEO of French auto maker Renault. Thierry Bolloré is the company’s new chief executive, and Michelin CEO Jean-Dominique Senard was named chairman. Here’s what’s next for the company. Photo composite: Laura Kammermann

Mr. Saikawa asked for shareholders’ support to stay on in his position, saying he hoped to avoid disrupting a company already shaken by the allegations against Mr. Ghosn. “I never said we didn’t have responsibility. The problem built up over 20 years, and we cannot correct it overnight,” Mr. Saikawa said.

Shareholders voted to remove Mr. Ghosn from the Nissan board, ending his final connection with the company he led for nearly two decades, and they elected Renault SA RNO -0.60% Chairman Jean-Dominique Senard to replace him. That ensures the French car maker, which owns 43.4% of Nissan, retains the full complement of board members mandated by its shareholding agreement with Nissan. Mr. Senard will become vice chairman of Nissan’s board, a newly created position.

Mr. Ghosn says he is innocent. On the compensation question, he says he discussed ways of receiving more pay after retirement but nothing was decided and so he didn’t have to report it.

The vote came after a three-hour meeting at which more than 20 shareholders spoke, often criticizing both Mr. Saikawa and Mr. Ghosn. The same shareholder who said Mr. Saikawa should be disqualified also called Mr. Ghosn an “outrageous monster.” Reporters could hear the questions but the shareholders’ identities weren’t disclosed.

New Suspicions

How Nissan money ended up with Carlos Ghosn, according to prosecutors and Nissan’s internal investigation. Mr. Ghosn’s representatives say neither Mr. Ghosn nor his family benefited from Nissan payments.

Nissan

Motor

A Nissan

subsidiary

Nissan

Middle

East

$15

million

from

2015 to

2018

million

Company

controlled

by Carlos

Ghosn

Suhail

Bahwan

Automobiles

Nissan distributor in Oman

and other countries

Sources: Japanese prosecutors; Nissan investigation

Mr. Ghosn was arrested again on April 4 on new suspicions he abused his position at Nissan for personal gain, and he is currently in jail. Prosecutors say they suspect Mr. Ghosn diverted a portion of Nissan payments to a distributor in Oman for his personal use. He denies wrongdoing. The arrest ended a monthlong period in which he was out on bail of nearly $9 million.

One shareholder spoke in defense of Mr. Saikawa, saying: “If it weren’t for Mr. Saikawa, Mr. Ghosn would be enjoying a ride on his yacht.” Nissan’s internal investigation, according to people familiar with it, found evidence Mr. Ghosn may have diverted company money to purchase a yacht.

A Tokyo-based spokesman for Mr. Ghosn didn’t immediately have a comment on the shareholder meeting.

Mr. Ghosn’s wife, Carole, was with him at his Tokyo apartment when he was arrested. She said in an interview the same day that prosecutors asked her to voluntarily submit to interrogation but that she refused. On Friday, Mrs. Ghosn flew to Paris. A family representative said she returned to France to encourage the French government to help her husband.

Write to Sean McLain at sean.mclain@wsj.com