Renault-Nissan Takes Control of AvtoVAZ

The Renault-Nissan alliance and Russian Technologies State Corp. are pooling their equity in AvtoVAZ to take control of the Russian carmaker by 2014.

Renault already owns 25% of AvtoVAZ, the maker of Lada cars. Russian Technologies holds a 24.5% stake in the company. The partners will transfer those stakes to a new venture, Alliance Rostec Auto BV.

Renault and Nissan also have agreed to invest $366 million and $376 million, respectively, to buy the 25% of AvtoVAZ held by Russian investment firm Troika Dialog.

The two investments will push Renault-Nissan's stake in Alliance Rostec to 67.1%, which in turn will own 74.5% of AvtoVAZ.

AvtoVAZ, Renault and Nissan own four assembly plants in Russia that the partners expect to achieve combined annual capacity of at least 1.7 million vehicles by 2016. Over the same span, the trio aims to boost its share of the Russian car market to 40% from the 30.5% this year.