Ford 'to sell 20% stake in Mazda'

Ford has reportedly decided to sell two-thirds of its stake in Mazda after apparently finding several Japanese buyers.

Japan's Nikkei business newspaper says that the stricken US carmaker, which owns 33.4% of Mazda, will sell what amounts to a 20% stake of the company for 50 billion yen (£345 million).

Hiroshima-based Mazda, which makes the RX-8 sports car and Miata saloon, might itself be one of the buyers. Its shares rose 6.4% as reports of the possible deal emerged.

Japanese companies including Hiroshima Bank, insurance company Tokio Marine Holdings and car-parts maker Denso have also been named as possible buyers.

The sale would give Ford some desperately-needed cash. It and fellow US carmakers General Motors and Chrysler are seeking a $25 billion (£16.7 billion) government lifeline to weather the deepening global economic crisis.

Over the past decade, Ford helped engineer a turnaround at the once-struggling Mazda, providing executives and sharing technology and parts to cut costs.

The company has struggled with plunging US sales while burning through nearly $11 billion (£7.3 billion) of its cash stockpile. It has reported its worst-ever loss of $8.7 billion (£5.8 billion) in the second quarter.

Copyright © Press Association 2008