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    AVTOVAZ’ S BOARD OF DIRECTORS ANNOUNCED PLANS TO RECAPITALIZE THE COMPANY

    On September 5th, AVTOVAZ’s Board of Directors announces that on October 10th, 2016, the Extraordinary General Shareholders’ Meeting of the Company will consider a matter of an open subscription for shares. This will become the first key step in the implementation of an overall recapitalization plan of the company for approximately RUB 85 billion (subject to further approvals of AVTOVAZ”s Board of Directors and shareholders), which will allow AVTOVAZ to finance its future expansion plans as well as meet its financial commitments.

    If approved by the shareholders, the open subscription will take place in December 2016. It is expected that the open subscription will result in an approximately RUB 25 billion capital increase.

    Alliance Rostec Auto, a joint venture between Renault-Nissan Alliance and Rostec, has already confirmed its intention to participate in this recapitalization in order to assist AVTOVAZ to take full advantage of the anticipated market rebound.

    Sergey Skvortsov, Chairman of the Board of AVTOVAZ: “Despite difficulties in the economic situation, AVTOVAZ shareholders believe in successful future of the automaker. Support measures are necessary to achieve the Company’s strategic goals – preservation and increase in the market share of at least 20%, achieving positive free cash flow, marginality level increase, development of export sales and localization of the suppliers’ base”.