Volvo sells stake in Renault for pounds 450m

Volvo yesterday took the final step in its long-running divorce from Renault, by selling all its remaining stake in the French car maker for pounds 450m.

Though the share sale had been expected, the Swedish group said the timing was dictated by the recent surge in Renault's share price. Volvo sold the 11.38 per cent shareholding to UBS, the Swiss banking group, for 750m Swedish kroner (pounds 453m), which compares with the stake's book value of pounds 58m.

Leif Johansson, Volvo's president, said the move confirmed the strategy taken by the group's new management since merger talks between the two companies collapsed four years ago. "We decided to take advantage of the rise in the price of the Renault share during 1997, which has been even more pronounced during the past week." Renault shares have risen by more than 40 per cent since the start of the year.

Volvo's long-running links with Renault, which has supplied the Swedish company with engines and other components since the 1970s, culminated in the merger proposals at the end of 1993. The announcement prompted an unprecedented public outcry in Sweden and a shareholder revolt, which led to the resignation of the entire Volvo board, including Pehr Gyllenhammar, the chief executive, weeks later.

Since then the new executive team has steadily reduced Volvo's shareholdings in other businesses, including food and drinks companies, to concentrate on car and lorry manufacturing. Yesterday's sale left just one remaining outside stake, in the drugs empire Pharmacia & Upjohn.

Volvo has also attempted to transform its conservative image, launching sports versions of its saloon range and a new smaller car, which have been well received. Analysts also said the cash raised could be ploughed into acquisitions in Volvo's truck business.

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview
When do the creative juices dry up?

When do the creative juices dry up?

David Lodge thinks he knows
The 'Cher moment' happening across fashion just now

Fashion's Cher moment

Ageing beauty will always be more classy than all that booty
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

Health fears over school cancer jab

Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

'I forgive everyone, but I don't forget'

Fifa president Sepp Blatter issues defiant warning to opponents
Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

Weather warning

Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

High hopes for LSD

Meet the volunteer users helping to see if it cures depression and addiction
German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

Saving Private Brandt

A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral