Renault to cut debt after a 3 billion euro sale of shares in Volvo AB

Article by Christian A., on October 9, 2010

Renault SA will soon reduce its debt due to a 3 billion euro ($4.2 billion) sale of shares in Volvo AB, which brought its shares to its highest in nine months last Thursday.

According to Volvo, the direction would be changed minimally and that Renault would still be the most influential voting shareholder. In particular, Renault sold B-class shares, which have less voting power.

Renault chief executive Carlos Ghosn said the share placing "confirms investor confidence in the future development of Volvo Group, which we share, as Renault will remain a major shareholder with 17.5% of voting rights.”

He explained that the proceeds are expected to reinforce Renault's balance sheet before a new strategic plan next year.

French brokerage CM-CIC Securities believes that the move will enable Renault to "seize the opportunity for a stakeholding partnership with General Motors" ahead of the IPO.

By 1027 GMT, Renault shares had increased by 7.4% at 39.2 euros. Earlier, the shares had gone up by 9.5%, the biggest one-day rise since March 2009 when global markets began to recover.

Volvo shares fell 4.3% to stand just below the 93 crown price at which Renault sold its shares. Volvo shares are higher by about 50% this year, compared to a 14% increase in the Stockholm benchmark index. [via autonews - sub. required]

Topics: renault, volvo, shares

If you liked the article, share on:

Comments

Recommended

It is quite common to revive classic cars if you have a lot of extra money. Models like the Jaguar XKSS and Aston Martin’s DB4 GT have been upgraded to...
by - August 21, 2017
Famous designer of certain Ferrari vehicles like the Enzo Ferrari and the P4/5, Ken Okuyama has revealed another one of his designs at the 2017 Pebble Beach Concours over the...
by - August 21, 2017
The current generation of the BMW M3 (F80) sedan isn’t just sporty and luxurious in terms of looks, but also in terms of performance. Because of its athletic appeal, the...
by - August 21, 2017
A lot of us know Singer Vehicle Design and their signature work of reimagining Porsche 911s, and making them look like hot rods from the 70s. They are not alone...
by - August 20, 2017
August 17, 2017 is a sad day for the Dodge Viper, its fans, enthusiasts and its admirers. It is the day when the last Dodge Viper rolled off the assembly...
by - August 20, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries