Renault announced it sold the rest of 6.5% stake in Volvo for 1.48 billion euro ($1.93 billion).
Renault said today, December 13th, that the block of 138.6 million ‘A’ shares was sold at $13.87 per share. According to an anonymous source, the shares were to be sold at a price between 91.25 and 93.25 Swedish crowns, for a total value of up to 1.48 billion euro ($1.94 billion).
“After this transaction is completed, the Renault group will no longer hold any shares in AB Volvo,” Renault said.
The automaker said it will use the money for international and domestic investments, but also to reduce the automotive net debt, which reached 818 million euro ($1.1 billion) as of June 30th. In 2001 Renault sold its trucks division to Volvo in return for shares. Renault Trucks remains a division of Volvo AB.
In 2010 much of the French automaker’s shareholding was divested, when the company offloaded its “B” shares, increasing its stake in Volvo to 14.9% and raising 3 billion euro. The rest of the “A” shares, which were sold today, carried 17.2% of Volvo’s voting rights.
“It’s really positive for them because they need the cash to invest in the automotive business and this clearly distinguishes them from PSA,” said analysts Sascha Gommel. “This puts them in a situation to invest in new models, in new technologies, unlike PSA which is really short with regards to cash-flow.”