Renault to Sell 5% Stake in Nissan

Renault has announced plans to sell a 5% stake in Nissan Motor back to the Japanese carmaker, with the transaction expected to be worth up to 765 million euros ($823.6 million). This move is part of Renault's strategy to gain an investment-grade rating.

Although the sale of Nissan shares could result in a capital loss of up to EUR1.5 billion, Renault emphasizes that this is the maximum amount and may be adjusted at year-end. The French company, which currently holds a 43% stake in Nissan, aims to reduce its holdings to about 15% as part of an agreement to streamline its partnership with the Japanese automaker.

Bernstein analysts believe that this initial sale marks the beginning of the process that will help Renault achieve an investment-grade rating. They anticipate that the deal could increase Renault's cash balance by approximately EUR4.2 billion.

The 5% stake being sold by Renault is part of the 28.4% stake that it transferred to a French trust last month. The sale will be implemented through a Nissan share buyback.

The estimates for the value of the sale and its expected impact are based on the assumption that 211 million Nissan shares will be sold at a share price of 568.5 Japanese yen ($3.89).