Ford Motor Company and Mazda Motor Corporation have been thoroughly entwined with one another on many levels since 1979, when Ford purchased a 25 percent share of then outstanding shares.
From there, Ford and Mazda spend the next three decades in what they have both referred to as a “mutually beneficial relationship,” centered largely around platform sharing, particularly with compact pickup trucks, and most recently with mid-size and subcompact car platform sharing.
But as Ford aims to reduce its debt and strengthen its capital standing, the automaker was forced to reduce what had eventually become a 33.4 percent share in Mazda down to 13.8 percent in November of 2008. At the time, Ford and Mazda said that their relationship would not change, and they would continue their decades old partnership into the future.
In fact, Ford and Mazda event completed a new passenger car plant in Thailand under their joint venture in July of 2009, but by November of last year Mazda issued a public offering, which effectively dropped Ford’s stake to an even less significant 11 percent stake.
Then in late March of this year Mazda announced that it would be partnering with Toyota in order to secure hybrid technology. Even still, as late as 35 days ago Ford said that they were “happy with their relationship with Mazda.”
Times change, quickly
Apparently things can change in 35 short days, as the Nikkei newspaper is reporting (Via Reuters) that Ford will now sell the majority of its remaining stake in Mazda to Sumitomo group firms, as well as other firms that hold business ties with Mazda. The newspaper said Ford is expected to reduce its stake to three percent, or less.
Ford’s shares in Mazda were valued at around $515 million by the end of May, according to Nikkei, which means the sale will likely free up around $410 million for Ford, possibly slightly more.
The deal is being orchestrated largely by Mazda, who has asked its main lending firm, Sumitomo Banking Corp., to purchase the majority of the shares Ford will sell. Sumitomo currently holds a 2.9 percent stake, which means it will become the largest single holder of Mazda shares after the transaction.
References
1.’Ford to sell bulk…’ view
