The alliance of Renault SA and Nissan Motor Co. is aiming to reach a deal next month to assume a dominant ownership of OAO AvtoVAZ, according to two people who are familiar with the situation. AvtoVAZ is the largest vehicle manufacturer in Russia. Currently, Renault owns 25 percent of the Russian automaker while Nissan doesn’t have any at all.
Renault may increase its ownership to 35 percent, giving Nissan 15 percent, the alliance’s spokesperson Rachel Konrad disclosed citing the comments made by Carlos Ghosn, CEO of both Nissan and Renault, to analysts during a presentation last Monday.
The additional 10 percent share of Renault and the 15 percent share of Nissan would be worth around $415 million, based on the current market value of AvtoVAZ.
Previously, the parties have announced that they are targeting the end of 2011 to conclude the negotiations. Also, the alliance is negotiating to buy the shares that Troika Dialog and Russian Technologies Corp. hold, both of which have 25 percent.
Spokesperson Valery Kartavtsev for Russian Technologies has yet to comment regarding the matter. A Troika Dialog spokeswoman did not comment, too. AvtoVAZ rules the vehicle market in Russia with its Lada brand with a 24 percent market share.
With the Russian automaker, the alliance aims to strengthen the combined market share of the three brands to 40 percent. Konrad disclosed that the alliance is in talks with the Russian automaker privately and that details will not be disclosed.