(Bloomberg) -- The arrest of Nissan Motor Co. Chairman Carlos Ghosn over suspected financial violations, reported by NHK, has rocked investor confidence in Renault SA on concern of repercussions for the French-Japanese alliance, given his “pivotal” role in cementing their pact.

The French auto company fell as much as 15 percent in Paris trading, the steepest intraday decline since June 2016, and the worst performer in a benchmark of European stocks.

Ghosn, 64, created the three-way alliance of Renault, Nissan and Mitsubishi Motors Corp. Renault and Nissan have given themselves two years to decide on a possible merger between the two automakers or find an alternative mechanism to enhance their partnership, Bloomberg reported in July.

READ: Ghosn Arrested After Icon Is Probed for Financial Violations

Here’s what analysts are saying:

Citi, buy on Renault

  • Ghosn is viewed as critical for value unlock; initial share price reaction “shows how pivotal he is for any potential collapse of the Renault-Nissan structure.”
  • Says Ghosn “is the cement that binds” the Nissan-Renault-Mitsubishi alliance together
  • Highlights reports do not suggest any wrong-doing by the company.
  • Core Renault trades on a 50 percent discount to its 10-year average; in the event that Ghosn doesn’t return, the broker would not be surprised for this discount to rise.

Commerzbank, Demian Flowers, hold on Renault

  • Nissan accusations may make it impossible for Ghosn to continue in role as Renault CEO.
  • Says Ghosn “is the cement that binds” the Nissan-Renault-Mitsubishi alliance together
  • Renault bulls have long argued that a full merger between Renault and Nissan could unlock trapped value. With Ghosn now likely removed from Nissan and also potentially from Renault, we are likely to see separate CEOs with separate objectives, making the probably of the merger more distant “with the evaporation of that hope reflected in today’s sudden devaluation.”

Evercore ISI, Arndt Ellinghorst, Outperform on Renault

  • “Clearly an arrest or restriction on Ghosn’s activities would be a blow to both Renault and Nissan.”
  • If Ghosn had to step down prematurely from Renault or Nissan, it would be “a set-back for one of the major catalysts” for Renault stock, namely corporate action to address present Renault/Nissan structure and resulting Renault “stub discount.”

Exane

  • With Ghosn getting salaries and rewards from Renault, Nissan and Mitsubishi across several regulatory jurisdictions, “the scope for mistakes in reporting are likely high.”
  • In the worst case of a more serious offense, and Ghosn unable to continue as Renault CEO and/or Nissan chairman, then “deeper questions over the long-term future of the Alliance structure would be called into question;” still, such a conclusion would be very premature at this stage.

--With assistance from Jan-Patrick Barnert and Blaise Robinson.

To contact the reporter on this story: Chiara Remondini in Milan at cremondini@bloomberg.net

To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net, Jon Menon, John Viljoen

©2018 Bloomberg L.P.