OREANDA-NEWS. September 24, 2012. GM-AVTOVAZ’s Board of Directors, including representatives of all the shareholders, met in Togliatti, Russia.  At the Meeting, the shareholders approved a series of important decisions regarding the further development of the joint venture, reported the press-centre of GM-AVTOVAZ.

Most significantly, the Board approved final funding of a project to extend the production capacity of the joint venture to 120,000 units per annum by 2015 and to develop the next generation Chevrolet NIVA.  The JV will fund the two projects with its own resources.  The facility expansion, most notably new Press and Body Shops and engineering support facilities, will take place on roughly 20 hectares within the Special Economic Zone of Togliatti.  In total, the project will create up to 1,400 new jobs.

Board members were informed about the completion of exterior and interior design works for the next generation NIVA model, as well as the launch of engineering activities, both of which underscored ongoing progress in implementation.  The launch of the next generation carline is planned for 2015.

Following the earlier announcement about the departure of the European Bank of Reconstruction & Development from the role of the JV shareholder (based on a Purchase of Shares Agreement dd. 06.09.2012), the Board of Directors approved the agreement providing that CJSC GM-AVTOVAZ will purchase the EBRD’s shares and then cancel them.  Accordingly, the share packages owned, respectively, by General Motors (via GM Auslandsprojekte GmbH) and JSC AVTOVAZ will remain the same, leaving both with a shareholding of 50%.  The transaction is due to be completed by the end of September, 2012.

The exit of the EBRD from CJSC GM-AVTOVAZ's Board of Directors has been planned in advance, and the change will not affect the joint venture's business today or in future.  Additionally, the EBRD's exit does not prevent the possibility of the Bank to participate in future joint venture projects.

GM-AVTOVAZ Managing Director Jeffrey Glover, on behalf of GM-AVTOVAZ team, extended his thanks to the EBRD for its support during the last ten years, including during the difficult launch of the project:  “Their support has helped ensure that world-class corporate management standards have become a key element of the business and have led to many years of profitable cooperation.  Their contribution has, in turn, benefited not only the JV, but the other two shareholders, the surrounding community and the automotive sector overall".