The management of Romanian carmaker Dacia has requested the majority shareholder, French carmaker Renault, to come up with another 108.7 million euros so that the X90 - the 5,000 euro car, project could be finished. The proposed capital increase is to be debated during the EGM of Shareholders scheduled for April 27.
"This is a stage in our medium and long-term development that targets attaining profitability once the 5,000 euro model is released. We still need some funding from shareholders for completing investment in the X90 project, the 5,000 euro car, and support so that the race towards the financial performance of this project does not start with a handicap," Constantin Stroe, Automobile Dacia vice-president told Ziarul Financiar. He added the capital increase was needed for the boldest project ever carried out by the Romanian producer to be all right both technologically and financially.
"The launch-related expenses will be substantial and we don't want to have any outstanding debts when we begin this project," Stroe explained.
Automobile Dacia's share capital currently amounts to more than 21,048bn ROL (more than 515 million euros).
French Renault Group became Dacia's principal shareholder in September 1999 when it paid $50 million for 51% in the company. Renault's stake several capital increases later has gone up to over 99%, and the Pitesti-based carmaker was delisted from the Bucharest Stock Exchange and turned into a closed company.
Renault's main goal when coming to Dacia was to build a completely new car priced at about 5,000 euros destined to emerging markets like Eastern Europe, South America or Africa. This model should allow the Romanian producer to become profitable and turn Dacia into an international brand.
ionut.bonoiu@zf.ro
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