Carlos Ghosn, chief executive officer of the Renault-Nissan alliance that’s agreed to buy control of OAO AvtoVAZ (AVAZ), said the Russian carmaker should sell all assets that are unrelated to making automobiles.
“There are plenty of assets which are not dedicated to this,” Ghosn, who runs both Renault SA (RNO) and Nissan Motor Co. (7201), said today in an interview in Yokohama, Japan. “From the beginning, we’ve said that we’re not particularly interested in these assets. So all these assets in our opinion can be sold and put at better use.”
Renault and Nissan said last week they plan to invest $750 million to form a venture with Russian Technologies Corp. that will own 74.5 percent of Russia’s largest carmaker by 2014. Jeremie Papin, the lead negotiator for the Renault-Nissan Alliance, said at the time that AvtoVAZ’s auto-supplying and social-related activities may be among assets targeted for disposal.
AvtoVAZ dropped 2.3 percent to 18.767 rubles, the lowest in a week, at the close in Moscow. The stock has fallen 5.4 percent this year.
As of the end of March, the Russian company’s non- automotive assets included stakes in a printing house and financial companies, holdings in a national racing series and riverside resorts, as well as ownership of a property- development company, according to the AvtoVAZ’s website.
Ghosn said he stood behind AvtoVAZ CEO Igor Komarov and offered to provide support.
“He is in fact responsible and accountable for the results of AvtoVAZ and we’ll give him all the necessary support -- management support, technological support, product support,” Ghosn said. “I trust him and I think he can carry the company further.”
Renault and Nissan are looking to the maker of Lada brand vehicles to fuel growth in Russia, which the government estimates may surpass Germany to become Europe’s biggest auto market in 2014.
As part of the preliminary agreement, Russian Technologies agreed to repay part of its outstanding loans in AvtoVAZ by selling some of the automaker’s “non-core assets,” according to the statement last week.
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