The Renault-Nissan Alliance has announced that it has inked a deal to take control of Russia’s largest automaker AvtoVAZ. The deal, which was agreed in 2012 and expected to be sealed this month, was completed on June 18, a Renault spokesman said.
A Reuters report said that, ss part of the agreement, Renault-Nissan now has a 67.1 percent stake in the holding company that controls AvtoVAZ. The holding, in which Russian state technology conglomerate Rostec owns the remaining shares, controls 74.5 percent of AvtoVAZ.
The Russian carmaker hasn’t been in good shape lately, reporting a loss last year, as slowing economic growth affected car sales in the country. Despite declining sales and Western sanctions on Russia over the Ukraine crisis, Renault said it is confident of its long-term prospects in the country.
Earlier this month AvtoVAZ announced that it will cut 13,000 jobs at its main plant in Togliatti because of dwindling sales of Lada models. The company’s CEO, Swede Bo Andersson, said earlier this year that the situation at AvtoVAZ was extremely bad, with people needing a “wakeup call.”
In 2008, Renault paid $1 billion (€0.73 billion) for an initial 25 percent AvtoVAZ stake.
By Dan Mihalascu
Note: Lada XRay Concept pictured