Renault SA has agreed to acquire almost half of Brilliance China Automotive Holdings Ltd.'s unprofitable minibus unit, giving the French carmaker a foothold in light commercial vehicles in the world's largest auto market.
The manufacturers will invest a combined 1.5 billion yuan ($221 million) in Shenyang Brilliance Jinbei Automobile Co. in proportion to their stakes, the companies said in a joint statement Wednesday. As part of the deal, Renault will pay 1 yuan to take a 49 percent stake in the subsidiary. Brilliance shares gained 3.2 percent to HK$14.30 at the close in Hong Kong, the biggest gain since May 31.
Renault President Carlos Ghosn is using the company's strength in delivery and utility vehicles to expand in China and attempt to rescue a struggling unit of Brilliance after restoring the fortunes of giants including France's biggest carmaker and Nissan Motor Co. Shenyang Brilliance Jinbei reported losses of 1.1 billion yuan over the past two years and 3.6 billion yuan in liabilities as of the end of 2016.