PARIS -- The French government closed the sale of 1.21 billion euros ($1.4 billion) in Renault shares, unloading a stake acquired in a power struggle with the automaker.
France sold 14 million Renault shares in an institutional placement, reducing its stake back to its historical level of 15 percent, the state's investment agency APE said Thursday. Renault will acquire about 1.4 million of the shares as part of the transaction.
French President Emmanuel Macron spearheaded the stake purchase as economy minister in April 2015 and is now reversing the move as promised. The sale may help smooth long-standing tensions between Renault CEO Carlos Ghosn, who also heads alliance partner Nissan as chairman, and Macron's government.
Renault's relations with its largest shareholder deteriorated in April 2015 when Macron abruptly raised the state's holding in a shareholder vote to almost 20 percent to secure double voting rights. Macron's move came after Nissan, which generates a majority of the profits in the Renault-Nissan alliance, had sought to gain a say in its partner.
Buoyed by stronger sales, Renault shares have climbed 16 percent in the last two months. The stock closed at 86.60 euros on Thursday, valuing the company at 25.6 billion euros. France will remain Renault's largest shareholder after the sale, narrowly ahead of Nissan.
Renault said Friday that it would buy 10 percent of the 1.4 million shares to use for an employee offering.
Financial analysts who track the Renault said the move would be likely to give a boost to the company’s stock price. "This news is quite positive as it will reduce tensions between the French government and Carlos Ghosn,” Xavier Caroen of Bryan Garnier said in a note to investors.
Evercore ISI said that the government’s move should be taken positively by investors, given that the oversize presence of the French government plays a significant role in the 40 percent discount that the market has applied to the stock. "We believe Renault, Nissan and their shareholders would welcome any further reduction in the French government’s position in Renault,” it said in a note.
French Finance Minister Bruno Le Maire said the 1.2 billion euros sale represented a 55 million euro gain on when the shares were bought two years ago.
While drawing a line under the 2015 hostilities, the divestment does little to resolve a sense of strategic stalemate over the future shape of Renault, Nissan and their new alliance partner Mitsubishi.
Ghosn, who turns 64 shortly before his current Renault CEO contract expires next year, has said the automakers are ready to forge closer capital ties but are prevented from doing so by the French government. "The day the French state decides to get out, everything is open, and I can tell you it won't take too much time," he said in February.
Reuters contributed to this report