PARIS (Reuters) - Saudi Aramco is set to take a 10% stake in a thermal engine joint venture between Renault and China's Geely called Horse Powertrain, said two sources familiar with the matter, beefing up a business supplying legacy automakers as electric-vehicle sales slow.

The agreement to take a 10% stake in the Horse Powertrain business, first reported by Bloomberg, is lower than the stake of around 20% which was cited by sources at the beginning of discussions.

The transaction would value Horse Powertrain at around 7.4 billion euros ($7.92 billion), said one of the sources.

The sources declined to be identified because discussions were confidential and still ongoing.

A Horse spokeswoman declined to comment, while Geely and Aramco did not immediately respond to a request for comment after business hours.

The Saudi oil group signed a letter of intent in March 2023 with a view to possibly becoming a minority shareholder in the JV, which was formally established on May 31.

Horse Powertrain supplies gasoline engines, hybrid systems and gear boxes for thermal vehicles.

($1 = 0.9342 euro)

(Reporting by Gilles Guillaume in Paris, additional reporting by Maha el Dahan in Dubai; Editing by Dominique Patton and Matthew Lewis)