Russia moved closer to securing long-term Western support for its struggling car industry on Tuesday as the government prepared for crunch talks with Renault and Daimler considered raising its stake in truck maker Kamaz.
Prime Minister Vladimir Putin will talk to Renault (RENA.PA) personally in Paris this week before finalising plans to rescue Lada maker AvtoVAZ (AVAZ.MM), which he insists must involve the French carmaker as a key investor in Russia's largest car firm.
"We will start implementing AvtoVAZ's development programme after high-level talks in Paris," Igor Shuvalov, a first deputy to Putin, said in a statement.
Russia is keen for Renault to offer to increase its current 25 percent stake in AvtoVAZ, which owes 60 billion roubles ($2.08 billion) in short-term loans. The French partner has yet to reveal its plans.
Meanwhile German giant Daimler (DAIGn.DE) has opened talks with Moscow investment bank Troika Dialog about increasing its stake in Kamaz (KMAZ.MM), Russia's largest truck maker, to 25 percent, sources told Reuters.
The move, which would cost around $270 million at current prices, or roughly the same as it paid for its existing 10 percent stake in 2008, comes on top of the signing of two partnerships between the two groups.
Daimler's Fuso and Mercedez-Benz trucks will be built as a joint venture with Kamaz to boost sales in the Russian market, which is expected to receive a boost from any rise in demand for industrial resources and commodities.
Kamaz shares were up 3.9 percent at 73.22 roubles by 1337 GMT, valuing the company at around 52 billion roubles ($1.8 billion).
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Analysts have said greater involvement from Daimler and Renault in their Russian partners would boost performance and reduce the need for the industry to rely on state help.
AvtoVAZ has nearly 100,000 workers in Togliatti, effectively a one-industry town, while Kamaz employs just under 60,000 and is based in the central Russian city of Naberezhnye Chelny.
Both companies have been rocked by a sales slump caused by the world economic slowdown, while AvtoVAZ in particular has received millions of dollars in state aid.
"If Daimler becomes a stronger strategic partner, it would be good news for Kamaz. It would bring access to Daimler's new technology and the benefit of building Daimler models in Russia," VTB analyst Vladimir Bespalov told Reuters.
State-run investment group and Kamaz shareholder Russian Technologies is also interested in the Troika stake, sources have told Reuters, though Daimler has first refusal.
Russian Technologies is keen to create a new holding company for its stakes in Kamaz and AvtoVAZ, a move that looks more likely to materialise following the appointment to the AvtoVAZ board of Kamaz chief Sergei Kogogin last week.
