Renault plans to sell its stake in Daimler worth about 1.2 billion euros ($1.4 billion), securing funds for its turnaround efforts after a record annual loss.
The French automaker will exit its entire holding in Daimler, a roughly 1.5 percent stake, according to a statement on Thursday.
Renault already has enough demand for all the stock, according to people familiar with the matter, who asked not to be identified because the information is private.
Proceeds from the sale will allow Renault to "accelerate the financial de-leveraging of its automotive activity," the company said.
It added that its industrial partnership with Daimler, which dates back more than a decade, remains unchanged and is not affected by the transaction.
Renault warned investors last month that another challenging year is ahead after recording a worse-than-expected 8 billion euro annual net loss.
CEO Luca de Meo has been battling daily to secure enough semiconductors to keep plants open, complicating his attempt to steer the company out of the rut it’s been in since longtime leader Carlos Ghosn was arrested in Japan in late 2018.
Daimler shares have surged since the Mercedes-Benz maker announced plans early last month to spin off its truck unit. The stock closed Wednesday at a three-year high.
Representatives for Daimler had no immediate comment.