Renault-Nissan And Russian Technologies Create Joint Venture To Finalize Strategic Partnership With AVTOVAZ

AsiaNet 51639

MOSCOW, Dec. 12, 2012 /PRN=KYODO JBN/ --

- Renault-Nissan and Russian Technologies create joint venture to accelerate

product launches and technology transfer to AVTOVAZ, Russia's largest carmaker.

- Renault-Nissan will get a majority stake in the joint venture, called

Alliance Rostec Auto BV, which will control AVTOVAZ, leader of the Russian auto

market.

- This deal promotes Renault, Nissan and LADA's improved synergy and product

development in the fast-growing Russian market.

The Renault-Nissan Alliance and Russian Technologies State Corporation have

created a joint venture which will hold their entire equity interests in

AVTOVAZ and serve as a stable, long-term controlling shareholder for Russia's

largest car company and the owner of the LADA brand.

Renault-Nissan Chairman and CEO Carlos Ghosn announced the creation of Alliance

Rostec Auto BV today at a ceremony in Moscow with Sergey Chemezov, General

Director of Russian Technologies and Chairman of the Board of AVTOVAZ, and Igor

Komarov, President of AVTOVAZ.

"Today's historic agreement is a win-win-win for all companies: Renault, Nissan

and AVTOVAZ. It is a significant new chapter in an already solid partnership,"

Ghosn said. "The joint venture will help accelerate our Russian market

offensive. It will support the competitiveness of AVTOVAZ, Russia's auto

industry leader."

According to the terms of the deal, Renault-Nissan will invest RUB23 billion

(US$ 742 million). The investment will give Renault-Nissan 67.13% of the joint

venture by mid-2014. The joint venture will then hold 74.5% of AVTOVAZ.

Renault, which purchased 25% of AVTOVAZ in 2008 and then helped AVTOVAZ in its

successful turnaround, will invest about RUB11.3 billion (US$366 million) in

the joint venture and plans to own 50.1% in the joint venture by June 2014.

Nissan which did not previously own a stake in AVTOVAZ, will invest RUB11.7

billion (US$376 million) and plans to own 17.03% in the joint venture by the

same period.

Over the same period, Russian Technologies will hold 32.87% of the joint

venture.

As part of the deal, Russian Technologies is restructuring its outstanding

loans with AVTOVAZ with RUB8 billion (US$258 million) proceeds from the

anticipated sale of AVTOVAZ's non-core assets being used to repay part of

Russian Technologies loans.

For the full release, go to:

http://www.media.blog.alliance-renault-nissan.com/news/3566

Video news release and b-roll also available on the site.

Source: Renault-Nissan Alliance