Mumbai: French carmaker Renault and Japan's Nissan will jointly invest Rs4,500 crore to set up a greenfield manufacturing facility at Oragadam, near Chennai.
The two auto majors today signed a memorandum of understanding with the Tamil Nadu government for setting up the proposed unit in which both Renault and Nissan would have 50 per cent stake each.
Renault executive vice president (products, plan and programs) Patrick Pelata and Nissan executive vice president (corporate and product planning) Carlos Tavares signed the MoU with the Tamil Nadu government
Renault and Nissan had earlier signed a tripartite joint venture with Mahindra and Mahindra (M&M) for the proposed plant. M&M, however, pulled out of the venture, saying it did not require the additional capacity being planned at Chennai and would rather expand its existing facility in Chakan near Pune.
Mahindra would have a majority 50 per cent stake in the plant while Renault and Nissan would have held an equal 25 per cent stake each.
Mahindra currently manufactures and markets its mid-size sedan Logan through a joint venture with Renault.
The proposed Renault-Nissan manufacturing facility, to be set up in a 670-acre area, is expected to go on stream in early 2010.
The plant would have a capacity to roll out four lakh units per annum over the next seven years, Renault-Nissan said in a statement.
Renault holds 44.4 per cent stake in Nissan.
Meanwhile, Renault is planning a deal with Bajaj to manufacture small car in India, possibly within this year, Carlos Ghosn, chief executive of both Nissan Motor Co and Renault said in Seoul.
"We have not signed any MoU so far," Ghosn told reporters after a speech at a university in Seoul.
He added that a deal could be expected "sometime within this year" as all parties were strongly willing to make a deal happen.
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