TOKYO (Reuters) - Mitsubishi Heavy Industries Ltd has decided to sell most of its 10 percent stake in Mitsubishi Motors Corp in a deal likely to exceed 50 billion yen ($460 million), the Nikkei business daily reported.
Sister company Mitsubishi Corp will likely buy the stake, making the automaker an equity-method affiliate, the paper said.
Mitsubishi Heavy said in a statement that while it was not the source of the report, it was working with trading firm Mitsubishi Corp and core lender Bank of Tokyo-Mitsubishi UFJ to explore ownership arrangements to support Mitsubishi Motors.
The three Mitsubishi group companies’ combined stake in Mitsubishi Motors would remain unchanged at about 22.5 percent, the Nikkei said.
Nissan Motor Co is Mitsubishi Motors’ top shareholder with a controlling 34 percent stake.
Mitsubishi Heavy is facing worsening earnings due to weak sales of gas turbines, while costs have spiraled for the development of Mitsubishi Regional Jets (MRJs) - a long-delayed project to build Japan’s first commercial aircraft in 50 years.
The company is set to announce financial results at 1:30 p.m. (0430 GMT).
Reporting by Chang-Ran Kim; Editing by Stephen Coates