Oil producer Saudi Aramco will buy a 10% stake in a thermal engines joint venture between French carmaker Renault and Chinese automaker Geely, the companies said on Friday, valuing the business at 7.40 billion euros ($7.93 billion).
The investment comes as the global electric-vehicle market struggles with worries around demand and rising production expenses © Mena Today
Oil producer Saudi Aramco will buy a 10% stake in a thermal engines joint venture between French carmaker Renault and Chinese automaker Geely, the companies said on Friday, valuing the business at 7.40 billion euros ($7.93 billion).
Geely and Renault will own around 45% each of the powertrain venture, called Horse Powertrain, which will supply gasoline engines, hybrid systems and gearboxes for thermal vehicles.
Reuters reported on Thursday that the state-owned company was close to buying a 10% stake in the venture. Renault CEO Luca de Meo described the deal in a statement as creating a "dream team" that would "reinvent" the future of combustion-engine and hybrid technologies.
"Aramco's stake in the thermal engine joint venture could stabilize investments in legacy automakers, providing a safety net amidst the electric shift," investor platform Finimize wrote, ahead of the official announcement.
The investment comes as the global electric-vehicle market struggles with worries around demand and rising production expenses.
The European Commission this month said it would impose extra duties of up to 38.1% on imported Chinese electric cars from July.
Aramco, which this month raised around $11.2 billion through a secondary share sale, had originally signalled it would buy a 20% stake in Horse Powertrain.
The company signed a letter of intent in March 2023 with a view to possibly becoming a minority shareholder in the venture.
Horse Powertrain was formally established on May 31.
($1 = 0.9334 euros)
Reporting by Rishav Chatterjee
Saudi Arabia issued alerts on Thursday warning of potential danger in Yanbu, the kingdom's Red Sea oil export hub, as Yemen's Iran-aligned Houthis continue attacks on the kingdom that have opened another front in the US-Israeli war on Iran.
Saudi Arabia and Syria signed a cooperation agreement between the two countries' defense ministries on Wednesday, Saudi state news agency SPA reported, as Yemen's Iran-aligned Houthi group continues its missile and drone attacks on the kingdom.
Turkey's parliament is set on Wednesday to ratify a defence pact with Saudi Arabia and Pakistan that includes a collective defence clause, committing NATO's second-largest army to Riyadh's defence as it faces attacks by Yemen's Iran-backed Houthis.
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