Ford Aiming For Cake and Eating Too - Trying to Sell Mazda Shares To Non-Competitor

Washington DC October 17, 2008; The AIADA newsletter reported that Ford Motor Co. is finalizing plans to sell shares in Mazda Motor Co. to about 20 Japanese firms, including insurers, and will likely outline the deal by next month, Japanese media reported on Friday.

Automotive News reports that Ford is looking to sell 20 percent of its 33.4 percent stake in Mazda as it struggles with weakening sales and the global credit crunch. Mazda will also buy back some of the shares. Ford has approached five nonlife insurers: Tokio Marine Holdings, Mitsui Sumitomo Insurance Group Holdings, Sompo Japan Insurance, Nipponkoa Insurance, and Aioi Insurance.

Besides the insurers, Ford has also approached trading houses, a parts maker, and steel makers. Each company is to buy about 1 percent in Mazda, the equivalent of about $40 million based on Mazda's market value on Thursday, and Ford is expected to raise some $1 billion.

Ford does not want to sell Mazda shares to rival automakers because the two companies intend to continue their business partnership that include operations of jointly owned factories in Thailand, China, and the United States.