Russian automotive giant quotes billion dollar price tag for Renault's re-entry
According to the CEO of Avtovaz, Renault is obligated to reimburse Russian investments totaling $1.3 billion in order to repurchase the shares it previously sold for 1 ruble. Read Full Article at RT.com.
TroibNews 
Renault will need to reimburse Russian carmaker AVTOVAZ up to $1.3 billion if it aims to reclaim its former business and re-enter the market, having exited the country previously, according to AVTOVAZ CEO Maxim Sokolov on Tuesday.
In 2022, AVTOVAZ acquired Renault’s share in the joint venture for a nominal price of 1 ruble, which included an option for Renault to return within a six-year period.
Renault, along with other foreign companies, exited Russia amid mounting international pressure following the escalation of the Ukraine conflict in February 2022.
Sokolov informed journalists that a return would only be feasible if Renault reimburses the investments made during its absence to advance the business, detailing that these investments are expected to exceed 112 billion rubles between 2023 and 2025.
“They [the investments] exceed the average annual investment volumes that were made by the previous shareholder, Renault, in the early 2020s,” the top executive stated. “Therefore, it’s clear that these investments will need to be reimbursed upon return,” he added, emphasizing that the cost of returning would not match the amount paid when they exited.
In 2022, Renault divested its 100% stake in Renault Russia and its 68% stake in AvtoVAZ, with Renault’s assets subsequently being transferred into Russian state ownership.
In November 2022, Russia commenced production of an updated version of the iconic Soviet-era vehicle brand Moskvich at Renault’s Moscow factory, which previously manufactured cars under the Renault and Nissan names.
The car manufacturer reported a write-down of over $2 billion due to its withdrawal from its second-largest market.
Camille Lefevre for TROIB News
In 2022, AVTOVAZ acquired Renault’s share in the joint venture for a nominal price of 1 ruble, which included an option for Renault to return within a six-year period.
Renault, along with other foreign companies, exited Russia amid mounting international pressure following the escalation of the Ukraine conflict in February 2022.
Sokolov informed journalists that a return would only be feasible if Renault reimburses the investments made during its absence to advance the business, detailing that these investments are expected to exceed 112 billion rubles between 2023 and 2025.
“They [the investments] exceed the average annual investment volumes that were made by the previous shareholder, Renault, in the early 2020s,” the top executive stated. “Therefore, it’s clear that these investments will need to be reimbursed upon return,” he added, emphasizing that the cost of returning would not match the amount paid when they exited.
In 2022, Renault divested its 100% stake in Renault Russia and its 68% stake in AvtoVAZ, with Renault’s assets subsequently being transferred into Russian state ownership.
In November 2022, Russia commenced production of an updated version of the iconic Soviet-era vehicle brand Moskvich at Renault’s Moscow factory, which previously manufactured cars under the Renault and Nissan names.
The car manufacturer reported a write-down of over $2 billion due to its withdrawal from its second-largest market.
Camille Lefevre for TROIB News
