Renault signs agreement to sell assets in Russia over Ukraine invasion
Paris, May 16 (EFE).- Renault announced Monday signing agreements to sell off its assets in Russia, including its Russian subsidiary and its majority stake in car manufacturer Avtovaz, with a buyback option for the next six years.
The Renault Group Board has unanimously agreed to sell 100 percent of it’s shares in Renault Russia to Moscow City entity and its 67.69 percent interest in Aavtovaz to NAMI, the state-owned Central Research and Development Automobile and Engine Institute, according to a statement by the company.
“Today, we have taken a difficult but necessary decision; and we are making a responsible choice towards our 45,000 employees in Russia, while preserving the Group’s performance and our ability to return to the country in the future, in a different context,” said Renault Group CEO Luca de Meo.
The French automobile firm had announced a suspension of its activities in Russia – its second most important market after France – on Mar.23 following the Russian invasion of Ukraine a month earlier.
As of Dec.31, 2021, these assets were valued at EUR 2.2 billion (around $2.3 billion). In July, when the first semester results are presented, the value adjusted to the date of the transfer will be known.
According to the statement, a non-cash adjustment charge amounting to the accounting value of the consolidated intangible assets, property, plant and equipment and goodwill of the Group in Russia should be recorded in the 2022 first half results.
Last year, Renault Russia produced 95,000 cars of the Duster and Arkana models aimed mainly at the Russian market and the countries around it.
As for Avtovaz, the company manufactured about 400,000 vehicles, basically with the Lada brand, in 2021.
From now on, Renault will no longer be able to assemble its cars at the Moscow facility. EFE
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