Renault's current 25% stake in Russia's largest carmaker AvtoVAZ could be increased, Prime Minister Vladimir Putin said on Friday.
"There is an agreement that Renault's stake will not decline, but could rise," Putin told reporters after talks in France.
Putin said the Russian government will allocate 50 billion rubles ($1.7 billion) to the ailing auto giant, and the French carmaker will invest 300 million euros ($447 million) in the plant in the near future via technology transfers and possibly as direct investment later.
Putin also said AvtoVAZ and Renault-Nissan plan to launch production of a Nissan model in Russia's Far East.
Speaking about a greater AvtoVAZ stake for Renault, Putin said no agreement has been reached on the score, but "we are ready to consider the possibility if the French side is interested."
The Russian government earlier said it would support Renault-Nissan taking control of AvtoVAZ.
Renault Vice President Christian Esteve, who is also a member of the AvtoVAZ board of directors, said the company would retain its share in the Russian automaker, but would not make additional financial investment.
AvtoVAZ's debts are expected to hit 75 billion rubles ($2.6 billion) by the end of the year. The company, known abroad for its Lada brand, saw its sales fall by 44% in the first half of this year to 179,000 cars.
The automaker, which dominates the economy of the Volga city of Togliatti, has announced plans to cut its 100,000-strong workforce by more than 25%, but pledged to re-employ many of them at affiliated companies.
AvtoVAZ's shareholders - Renault, Russia's State Technology Corporation (Rostekhnologii) and Troika Dialog investment, all holding 25% plus one share - signed an agreement to restructure the plant in France on Friday on the sidelines of Putin's visit to the country.
Rostekhnologii head Sergei Chemezov told reporters that under the restructuring plan AvtoVAZ would start producing two new Renault, two Lada models, and a Nissan model in late 2011-2012.
Chemezov said Lada models would account for 70% of the plant's output.
RAMBOUILLET, November 27 (RIA Novosti)
