French and Italian leaders have revelled in throwing mud at each other, but two of the countries’ flagship companies are now looking beyond the bad blood to cozy up to each other.

The prospective deal, a proposal by Fiat Chrysler Automobiles NV to merge with Renault SA, could create the world’s third-biggest carmaker. The prospect is already triggering contrasting responses from politicians, though the Italian company has said there won’t be plant closures as a result of the combination.

Nissan, a long-time Renault partner, has been left sidelined by a potential tie-up between the two companies, just as the beleaguered Japanese firm battles to recover from the arrest of former boss Carlos Ghosn.

On hearing news of the tie-up, the rightist League party of Deputy Premier Matteo Salvini, who has in the past clashed virulently with French President Emmanuel Macron, swiftly invoked Italy’s national interest and dangled the option of the Rome government stepping in. The League, after all, campaigned for Sunday’s European Parliament election on an Italy First platform. “Given the state presence in Renault, the fact that two companies of this size plan to merge has to be looked at with special care,” the League’s Claudio Borghi, who heads the lower house budget committee, told La7 television. Borghi was quick to remind viewers that the French government fought tooth-and-nail against a bid by Italy’s Fincantieri for the France-based STX shipyard.

Debt mountain

A French government official said it would be surprising if the founding Agnelli family welcomed a state presence in the company. The official also wondered aloud whether the Italian government — already burdened with a mountain of debt — would have the funds to pay for it.

Still, the official could not see any political risks to the merger, and insisted it would be a win-win for the two countries and their economies.