This transfer is due to the Russian invasion of Ukraine.
“Agreements have been signed for the transfer of Renault Group’s Russian assets to the Russian Federation and the Moscow Government,” the Russian Ministry of Industry and Trade said in a statement.
Renaul confirmed the sale of about 68% of Avtovaz, Russia’s largest carmaker.
But the French group says it retains the option to buy back the shares for six years.
No financial details were provided on Monday, Russian Industry and Trade Minister Denis Manturov said in April that Renault planned to sell its Russian assets at a “symbolic ruble value”.
“Today we have made a difficult but necessary decision, and we are making a responsible choice for the 45,000 employees in Russia, keeping the performance of the group and our ability to return to this country in the future, in a different context,” said Renault CEO Luca de Meo, quoted in the group’s statement.
RENAULT’S SECOND MARKET IN THE WORLD
However, the group states that it retains the option to repurchase its shares for six years.
“The Board of Directors of Renault Group unanimously approved the signing of agreements for the transfer of 100% of the shares of Renault Group Renault Russia, Moscow, and its 67.69% stake in Avtovaz to NAMI (Central Institute for Automotive Research and Development and Engines), ”he announced in a statement, without specifying the amount.
“The agreement provides for an option for the Renault Group to repurchase its stake in Avtovaz, which may be exercised at certain times over the next six years,” he said.
Moscow Mayor Sergei Sobyanin also announced that Renault had decided to close its plant near the Russian capital, which produces Nissan and Renault cars.
Russia is Renault’s second largest market in the world, after Europe, with nearly 500,000 vehicles sold in 2021, but the group’s presence in the country has been in question since the start of Russia’s offensive in Ukraine.
The car group is facing logistics problems due to a shortage of imported spare parts due to Western sanctions.
As a result, Avtovaz was forced to send its employees on paid leave for three weeks in April, after it had stopped most of its production.
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