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March 4, 2010

RUSSIA: GAZ may form foreign alliance

Russian automobile manufacturer GAZ may set up an alliance with an unspecified foreign car maker, an industry and trade ministry source has said.

Russian automobile manufacturer GAZ may set up an alliance with an unspecified foreign car maker, an industry and trade ministry source has said.

GAZ may follow in the footsteps of Russia’s AvtoVAZ and Sollers, which created alliances with France’s Renault and Italy’s Fiat, respectively, the source told the Prime-Tass news agency.

State-owned Sberbank said earlier this week GAZ had agreed to restructure all of its debt at 4% over the Russian central bank’s official refinancing rate.

GAZ, controlled by tycoon Oleg Deripaska through Russian Machines, owes RUB39.3bn (US$1.31bn) to a consortium of 22 banks.

The new loan will have a term of five years, and GAZ will not have to make any interest payments for the first six months. In addition, it will not have to start repaying the principal for two years.

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