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Investing.com -- French carmaker Renault (EPA:RENA) announced it will record an estimated €9.5 billion ($11.20 billion) non-cash loss on its stake in Nissan (OTC:NSANY) Motor in the first half after changing its accounting method for the investment.
Renault, which maintains a 35.7% stake in Nissan, said that going forward, any changes in the value of its holding will be directly recognized in equity and assessed based on Nissan’s share price, without affecting its net income.
The accounting change follows an agreement between the two automakers to loosen their ties and adjust their two-decade partnership to support the Japanese firm’s recovery.
According to Renault, the new accounting treatment stems from recent changes in the terms and conditions for exercising its rights related to the Nissan stake.
The estimated €9.5 billion loss will be recognized in the income statement, primarily as "other operating income and expenses" at the date of the change.
The company emphasized that this accounting adjustment will have no cash impact and will not affect the calculation of dividends paid by Renault Group.
The loss amount represents the difference between the current carrying value of the investment and its estimated fair value based on Nissan’s stock price as of June 30, 2025, plus the impact of recycling conversion reserves and net investment hedges related to Nissan’s equity-accounted securities.
This approach aligns the value of the Nissan stake in Renault’s financial statements with Nissan’s actual share price.
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