GAZ Group, the Russian owners of Birmingham-based van maker LDV, has bought a 50% share in VM Motori, a diesel engine manufacturer based in Italy.
General Motors has bought the other 50% stake.
VW Motori currently supplies LDV with diesel engines for its Maxus range, along with other international brands including Chrysler and Jeep.
As part of the agreement GAZ Group will produce the VM Motori engines under licence for the Maxus range and will have more control over the transfer from the production line to the LDV site in Birmingham.
Evgeniy Vereshchagin, LDV’s chief executive, said: "This investment by the group will give LDV greater access to a wide range of diesel engines.
"It’s an exciting development and allows the company increased flexibility and input in developing future engines for the Maxus range."