will chip in $300 million, plus its 25% stake in , to a new JV that will control 67.13% of the Russian auto maker. will invest $450 million.
Largus first Lada to come from Renault platform.
Equity partnersand will form a joint venture with state-controlled Russian Technologies that gives the two auto makers an indirect majority stake in .
The non-binding memorandum of understanding signed in Paris calls for- and Russian Technologies to contribute their stakes in to the new joint venture that will control the Russian car maker and its Lada brand.
The deal will see the Renault-Nissan Alliance invest $750 million, which will give it a 67.13% stake in the JV in mid-2014. The JV then will control 74.5% of AvtoVAZ.
Renault purchased 25% of AvtoVAZ in 2008. Its share of the new capital is $300 million. Nissan, which doesn’t own a stake in the Russian auto maker, will chip in the remaining $450 million.
Russian Technologies will restructure some outstanding loans with AvtoVAZ, and the auto maker is expected to raise RR7 billion ($238 million) in the sale of some non-core assets in order to pay down some of the Russian Technologies loans.
The balance, some RR46 billion ($1.56 billion) in loans will be extended interest-free “well beyond its current maturity date,” the partners say in a release, providing AvtoVAZ with a “strong balance sheet with no liquidity constraints.”
Renault-Nissan and AvtoVAZ recently launched joint production of the first Lada model based on a Renault platform. AvtoVAZ’s Togliatti plant is expected eventually to produce up to 350,000 vehicles annually based on the Renault/Dacia Logan platform.
The facility is scheduled to launch output of the new Nissan Almera sedan in November, and two Renault models will be added in 2013.