"Today a decision has been made that the Izhevsk auto plant will be taken over by the AvtoVAZ-Renault-Nissan alliance," Mikhail Dobyndo told an investment forum in Izhevsk, the capital of the Russian republic of Udmurtia, where the company is based.

The global car manufacturing giant Renault-Nissan bought a blocking stake of 25% plus one share in AvtoVAZ for $1 billion late in February.

A representative of IzhAvto told RIA Novosti over the phone that although the decision had been made it was not yet backed by any official documents. "As long as there are no official documents, it is too early to say that the deal will go through. There is only a statement of intentions and there are still no framework agreements."

IzhAvto has an annual production capacity of 220,000 vehicles. The company manufactures Korean-designed KIA models under a deal with Seoul-based KIA Motors, and also VAZ cars and Izh vans.

AvtoVAZ sold a record 663,500 cars in 2007 and plans to roll out 1.5 million cars annually by 2015. The company also plans to conduct an IPO in late September.