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Friday, November 27, 2009
Russia, Renault Agree On Avtovaz Restructuring
By Polya Lesova
MarketWatch Pulse
FRANKFURT -- Renault SA and the other shareholders of troubled Russian carmaker Avtovaz said Friday they have agreed on a restructuring plan for the company. Under the plan, the Russian government will increase its financial support for Avtovaz from 25 billion to 75 billion rubles ($2.5 billion) to reimburse bank debt and cover the company's short-term cash needs. Renault will contribute the equivalent of 240 million euros ($358 million) in-kind through the transfer of technologies, production machinery, equipment and expertise in support of the production of new vehicles. Renault will also help Avtovaz develop a new entry-level vehicle to replace the Lada Classic and create new powertrain production capacity. Renault has a 25% stake in Avtovaz.
Copyright © 2009 MarketWatch, Inc.
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