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Nissan shares fell 6% on Tuesday a day after the arrest of CEO Carlos Ghosn in Japan.
Nissan CEO Carlos Ghosn was arrested in Japan on Monday for financial misconduct. The Japanese carmaker's CEO was arrested for allegedly underreporting income and as a result will be fired from the board this week. it was also found that Ghosn had also used company money for personal use.
Analysts have flagged that Ghosn’s arrested could jeopardise the company’s global alliance that Ghosn personally shaped throughout his career.
Nissan stated that the implications of Ghon's stewardship of both Renault and Nissan had gone unquestioned since 2005.
According to prosecutors, Ghosn and Representative Director Greg Kelly conspired to understate Ghosn's compensation to be half of the actual 9.998 billion yen ($88.9 million).
Mitsubishi, Renault and Nissan shares fall
‘The investigation showed that over many years both Ghosn and Kelly have been reporting compensation amounts in the[Japan 225] securities report that were less than the actual amount, in order to reduce the disclosed amount of Carlos Ghosn's compensation.
Also, in regard to Ghosn, numerous other significant acts of misconduct have been uncovered, such as personal use of company assets,’ said Nissan.
Nisan shares fell to a low of 940 yen and were trading down 5.5 percent at 950.7 yen on Tuesday, after the arrest.
Shares in Mitsubishi Motors Corp , another member of the Franco-Japanese partnership, also slid by about 6%. Renault shares lost 8.4% on Monday.
There has been no comment from Ghosn or Kelly on the allegations, however the carmaker apologised to shareholders and vowed to cooperate with Japanese authorities after the former chair's arrest.
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