TOKYO (AP) -- Ford Motor Co. is slashing its stake in Japan's Mazda Motor Corp. by nearly two-thirds, joining other struggling U.S. automakers in a fire-sale of prized assets to stay afloat.
Ford, which owns 33.4 percent of Mazda, will sell about a 20 percent stake, the companies said in separate statements.
The sale would net Ford 52 billion yen ($540 million) based on Mazda's closing price Tuesday, barely a quarter of what a 20 percent stake in the Japanese automaker was worth one year ago. Mazda's shares rose 6.4 percent to 184 yen Tuesday amid media reports of a coming sale.
Hit by a slump in the U.S., Ford is burning through cash reserves and, along with General Motors Corp. and Chrysler LLC, is seeking a $25 billion government lifeline to weather the deepening economic crisis. On Monday, GM said it would sell its remaining 3.02 percent stake in Japan's Suzuki Motor Corp. for 22.37 billion yen ($230 million).
Ford racked up losses of $8.7 billion in the second quarter, its worst result ever, and has used up $11 billion of a cash stockpile in the past year. The share sale was "in line with Ford's plan to strengthen its balance sheet," it said.
Over the last decade, Ford helped engineer a turnaround at once-struggling Mazda, sending executives and sharing technology and auto parts to cut costs.
Ford and Hiroshima-based Mazda, which makes the RX-8 sports car and Miata roadster, said they will maintain their strategic relationship. Ford said it will remain Mazda's largest shareholder and they will continue to share core design platforms and key components.
Mazda said it will buy up to 6.87 percent of its own shares for as much as 17.9 billion yen ($185.3 million) through an off-hours trading system on Wednesday morning and several "strategic business partners" will mop up the rest.
The company was mum on the identities of the other buyers, but media reports mentioned Japanese companies including regional Hiroshima Bank, trading houses Sumitomo Corp. and Itochu Corp., insurance firms including Tokio Marine Holdings Inc. as well as auto parts maker Denso Corp., as purchasers.
