Nissan Intends To Sell $1 billion Worth Of Bonds To Help The Brand

Nissan Motor is set to sell 150 billion yen (approximately $1.04 billion) in convertible bonds to fuel new CEO Ivan Espinosa’s decisive plan to revitalise the struggling automaker.

The proceeds from the sale will be used to invest in new products and technologies, such as electrification and software-defined vehicles, the Japanese company said.

The company, which faces large debt repayments next year, plans to raise more than a trillion yen from debt and asset sales to keep the business afloat, Bloomberg News reported in May.

Stocks posted their biggest drop in nearly three months after the sale of convertible bonds was announced. The company’s shares fell as much as 5.2 percent in Tokyo before partially recovering, and at 1:04 p.m. local time, they were about 3.0 percent lower than the day before.

Still, Nissan shares have fallen by around 40 percent over the past 12 months.

Nissan currently has enough capital—about ¥2.2 trillion in cash and credit lines—to last the next 12 to 18 months, Espinosa told Bloomberg.

The new chief executive announced plans to cut 20,000 jobs and close seven of Nissan’s 17 factories by March 2028, after the company reported a net loss of 671 billion yen for the last fiscal year. These measures followed failed negotiations earlier this year on a merger with Honda Motor Company. Those talks broke down in part because of disagreements over Nissan’s willingness to make deeper cuts to production and employees.

• Read More: Nissan Plans To Lay Off An Additional 10,000 Workers