MOSCOW—Nissan will hand over its business in Russia to a state-owned entity for 1 euro ($0.97), taking a loss of around $687 million. The decision marks the latest costly exit from the country by a global company.

The automaker will transfer its shares in Nissan Manufacturing Russia to state-owned NAMI. The deal will give Nissan the right to buy back the business within six years. The sale will include Nissan’s assembly plant and research facilities in St. Petersburg, as well as its sales and marketing center in Moscow.

Nissan had suspended production at its St. Petersburg plant in March due to supply chain disruptions. Now, with the war in Ukraine showing no signs of ending any time soon, the automaker has opted to exit the country. Nissan sold 53,000 vehicles in Russia last year.

The deal marks the latest major company exit since Russia invaded Ukraine in February. In May, Nissan’s partner, Renault, sold its majority stake in Russian automaker AvtoVAZ to a Russian investor. Renault reportedly sold its stake in AvtoVAZ for 1 ruble ($0.0157).

The exit comes as Nissan has embarked on a major shift in its relationship with Renault. The partners are in talks about the future of their alliance, and Nissan is considering investing in a new electric vehicle venture by Renault.

Renault, which owns 43 percent of Nissan, estimated that Nissan’s decision to quit Russia would lead to a 331 million euro hit to its net income for the second half of 2022.