Renault to buy out Nissan's stake in Indian joint venture

New Delhi: French auto major Renault on Monday said it will buy out its Japanese partner Nissan's stake in their Indian joint venture -- Renault Nissan Automotive India Private Ltd.

Renault Group would own 100 per cent of Renault Nissan Automotive India Private Ltd (RNAIPL), by acquiring the 51 per cent shareholding currently held by Nissan, the company said in a statement.

The company, however, did not disclose the financial details of the transaction.

Renault Group and Nissan have entered into a share purchase agreement to this effect.

Upon the completion of this transaction, Renault Group would own 100 per cent of RNAIPL, it added.

The agreement also includes an operational agreement to continue the current projects between Renault Group and Nissan, and to define the future relationship of Renault Group and Nissan in India.

Nissan will continue to use RNAIPL for sourcing vehicles for India and for exports in the coming years, the statement said.

Meanwhile, Renault Group and Nissan will continue to operate jointly, Renault Nissan Technology & Business Center India (RNTBCI) in which Nissan will retain its 49 per cent stake and Renault Group will hold its 51 per cent stake.

RNAIPL would continue to produce Nissan models, including the New Nissan Magnite, and will serve as a crucial pillar for the company's future expansion plans, the company said.

Under the agreement, Renault Group, through Ampere, the first European intelligent EV pure player, would develop and produce a derivative of Twingo, a A-segment vehicle, for Nissan from 2026. This model will be designed by Nissan.

This project represents a key opportunity for Renault to expand its international business, it said, adding Nissan will maintain its presence in India with a strong focus on increasing market coverage, the statement said.

"As a long-time partner of Nissan within the alliance and as its main shareholder, Renault Group has a strong interest in seeing Nissan turnaround its performance as quickly as possible.

"Pragmatism and business-oriented mindset were at the core of our discussions to identify the most effective ways of supporting their recovery plan while developing value-creating business opportunities for Renault Group," Renault Group CEO Luca de Meo said.

He further said, "this Framework Agreement, beneficial for both parties, is the proof of the agile and efficient mindset of the new Alliance. It also confirms the attractiveness of our products with Twingo as well as our ambition to grow our business on international markets. India is a key automotive market and Renault Group will put in place an efficient industrial footprint and ecosystem."

After the completion of this transaction, RNAIPL would be consolidated at 100 per cent in Renault Group's consolidated financial statements, the statement said.

Renault said, "2025 is a year of peak investments for RNAIPL, in line with the launch of new vehicles. Thus, the free cash flow impact for the year is expected to be around 200 million euros (taking account of its completion by the end of H1 2025)."

Nissan's incoming President and CEO Ivan Espinosa said,"We remain committed to the Indian market, delivering vehicles tailored to local consumer needs while ensuring top-notch sales and service for our existing and future customers."

He further said, "India will remain a hub for our research and development, digital and other knowledge services. Our plans for new SUVs in the India market remain intact, and we will continue our vehicle exports to other markets under the "One Car, One World" business strategy for India."