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Pelata Resigns Renault’s No. 2 Position Over Spying Affair

Patrick Pelata Resigns Renault's No. 2 Position
Patrick Pelata, chief operating officer of Renault SA, resigned from his post as the French carmaker’s second-in-command over a botched espionage investigation that led to the wrongful dismissal of three senior managers. Photographer: Antoine Antoniol/Bloomberg

Renault SA accepted Patrick Pelata’s resignation from his post as the French carmaker’s second-in-command over a botched espionage investigation that led to the wrongful dismissal of three senior managers.

Pelata will stay on temporarily as chief operating officer before moving to a role within the carmaker’s alliance with Nissan Motor Co. Ltd., the Boulogne-Billancourt, France-based company said in an e-mailed statement today.

The board of directors also agreed at an emergency meeting on the departure of Laurence Dors, the company’s general secretary; human resources manager Jean-Yves Coudriou; Legal Director Christian Husson and Director of Security Remi Pagnie.

Renault admitted last month it was tricked into wrongfully firing three executives after a company investigation incorrectly concluded they had received payments from Chinese companies via foreign accounts. Security manager Dominique Gevrey, who obtained more than 300,000 euros ($434,000) from the carmaker to pay an anonymous source for the information, was arrested on fraud charges after the espionage claims unraveled.

Renault’s board examined the findings of an audit ordered last month to establish the roles and responsibilities of executives involved in the spy case. The inquiry revealed “failings and dysfunction within the company, particularly in the control and supervision of its security department,” the automaker said.

Shares Drop

Renault fell 88 cents, or 2.2 percent, to 38.99 euros in Paris trading today. The stock has declined 10 percent this year, valuing the company at 11.5 billion euros.

The Renault board approved a draft settlement negotiated with the three wrongfully dismissed executives: upstream development Michel Balthazard, his former subordinate Bertrand Rochette and electric-car deputy program chief Matthieu Tenenbaum. The automaker didn’t disclose any details.

“It is a very satisfying settlement,” said Xavier Thouvenin, a lawyer for Balthazard. He declined to specify how much the former executive will receive. The unanimity of the board’s decision was “very important to us” and ends his client’s wrongful firing complaint, he said.

Tenebaum’s lawyer, Thibault de Montbrial, confirmed that an agreement had been reached, while Rochette’s lawyer didn’t immediately return calls for comment. The criminal investigation into how the three men were targeted continues, Thouvenin said.

“We still want to know who started it,” he said. “That will be the end of the story.”

Government Pressure

The French government, Renault’s biggest shareholder with a 15 percent stake, had raised pressure for resignations before the meeting, with Finance Minister Christine Lagarde saying those responsible for the affair “must depart.” Pelata has been a close associate of Chief Executive Officer Carlos Ghosn for more than a decade.

Ghosn, who also heads Japanese affiliate Nissan Motor Co., refused an earlier resignation offer from Pelata over the espionage case, the carmaker said March 14.

The 55-year-old Pelata, who ran day-to-day affairs at Europe’s second-largest carmaker, graduated from France’s elite Ecole Polytechnique in the same 1974 class as Ghosn, before joining Renault as head of bodywork assembly at the carmaker’s plant in Flins, west of Paris.

In 1999, when Ghosn was sent by then CEO Louis Schweitzer to rescue Nissan from near-bankruptcy, he took Pelata with him and the two have worked closely together ever since. Pelata took over day-to-day control from Ghosn in 2008.

Pelata “will continue to manage operations until his departure from Renault,” when he will move to another job within the automaker’s alliance with Nissan, the statement said.

The company also negotiated an agreement with Philippe Clogenson, a fourth executive wrongfully dismissed in 2009, who will return to work next month as business development director for Renault Consulting, Renault said.

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