New agreement affirms AvtoVAZ restructuring
The "Base Agreement" has been signed by Russian Technologies State Corporation, Renault and Troika Dialog Investment Company and reaffirms the shareholders’ interactions during the process of restructuring and recapitalizing AvtoVAZ.
In particular, it sets out that by 2012 Renault will invest the equivalent of €240 million, keeping its stake in AvtoVAZ at a level no lower than 25% plus 1 share. The funds will be used to support the production of new models on the B0 (Logan) platform. Renault is also assisting in the development of an entry-level model to replace the “classic” Lada model.
Russian Technologies State Corporation, in turn, will convert a proportional part of AvtoVAZ’s debt into shares.
In 2012, following the completion of the main recapitalizing phases, the parties will announce the initial results and set down the main vectors of the strategic partnership’s future development.
Commenting, Igor Zavyalov, deputy general director for finance and economics at Russian Technologies State Corporation and member of the AvtoVAZ board of directors, said: 'Realising the agreement between the core shareholders in AVTOVAZ is the latest important step in developing Russia’s auto industry, which is proceeding according to the industry development strategy approved by the relevant government ministries.'
Under the AvtoVAZ business plan, the carmaker will produce 900,000 automobiles per year from 2015, 70% of which will be AvtoVAZ models, and will hold a 25% share of the Russian market.For more of the latest industry news, click here.