Renault SA plans to sell its stake in

Daimler AG worth about 1.2 billion euros ($1.4 billion), securing funds for its turnaround efforts after a record annual loss.

The French car manufacturer will exit its entire holding in Daimler, a roughly 1.5% stake, according to a

statement 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. Chief Executive Officer 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 its been since long-time 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. BNP Paribas SA and HSBC Holdings Plc are advising on the stake sale, according to people familiar with the matter.

With assistance by Christoph Rauwald

(Updates with Renault having demand for stock in second paragraph.)

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