Japanese car maker Nissan leaves Russia; to sell his company for 1 euro

Nissan Motor Co Ltd will transfer its business in Russia to a state-owned company for 1 euro ($0.97), it said Tuesday, posting a loss of about $687 million on the latest expensive exit from the country by a global company.

Japanese automaker transfers its shares in Nissan Manufacturing Russia LLC to state-owned NAMI, it said. The deal gives Nissan the right to buy back the company within six years, Russia’s Ministry of Industry and Trade said.

The deal makes Nissan the last major company to leave Russia Moscow sent tens of thousands of troops into Ukraine in February. It also reflects a move by Nissan’s largest shareholder, French carmaker Renault, which sold its majority stake in Russian carmaker Avtovaz to a Russian investor in May.

The sale to NAMI includes Nissan’s manufacturing and research facilities in St. Petersburg and its sales and marketing center in Moscow, the ministry said. Nissan said it expected an extraordinary loss of about 100 billion yen ($687 million), but maintained its profit forecast for the fiscal year ending March.

Renault, which owns 43% of Nissan, estimated that its Japanese partner’s decision would lead to a net profit of €331 million for the second half of 2022.

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Nissan had halted production at the St. Petersburg plant in March due to supply chain disruptions. Since then, the company and its local unit have been monitoring the situation, it said. But there was “no view” of a change in the external environment, Nissan said, prompting him to decide to retire.

Junior alliance partner Mitsubishi Motors Corp is also considering leaving Russia, Nikkei newspaper reported. A Mitsubishi spokesman said nothing had been decided yet. The exit comes as Nissan has begun a major shift in its relationship with Renault. The two said on Monday they were in talks about the future of their alliance, which includes Nissan considering investing in a new Renault electric car venture.

Those talks, which could lead to the alliance’s biggest reset since the 2018 arrest of former chief executive Carlos Ghosn, also include the possibility of Renault selling part of its majority stake in Nissan, two people with knowledge of the talks have told. Reuters told. .

Renault reportedly sold its stake in Avtovaz for one ruble ($0.02).

The Nissan deal was “of great importance to the industry,” Russia’s Industry and Trade Minister Denis Manturov said in a statement.

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