Renault to Sell Back $824 Million Stake to Nissan as It Seeks Rating Upgrade -- Update

By Adria Calatayud and David Sachs

Renault plans to sell a 5% stake in Nissan Motor back to the Japanese carmaker for up to 765 million euros ($823.6 million), commencing a draw-down of its shares as part of a plan to gain an investment-grade rating.

The French company said Tuesday that the sale of the Nissan shares could result in a capital loss of up to EUR1.5 billion which would hit net profit in its own accounts. This is the maximum amount and could be adjusted at year-end, Renault said.

Renault, which has a stake of around 43% in Nissan, aims to whittle its holdings down to about 15% as part an agreement between the longtime partners to thin out their relationship. Tuesday's sale commenced that process, which Renault hopes will help it achieve an investment-grade rating, Bernstein analysts said in a research note.

Bernstein said the deal could grow Renault's cash balance by around EUR4.2 billion.

Renault said the 5% stake in Nissan it is selling back to its Japanese partner is part of a 28.4% stake it transferred to a French trust last month. The sale will be implemented as part of a Nissan share buyback.

Renault's estimates for the value of the sale and its expected impact assume 211 million Nissan shares are sold at a share price of 568.5 Japanese yen ($3.89),it said.

Write to Adria Calatayud at [e-mail] and to David Sachs at [e-mail]

(END) Dow Jones Newswires

December 12, 2023 07:40 ET (12:40 GMT)

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