Nissan Motor Co., its transmission unit Jatco TransTechnology Ltd. and Mitsubishi Motors Corp. signed an agreement Monday to integrate the automatic transmission and continually variable transmission businesses of MMC and Jatco, the three firms said.
Under the agreement, which was initially announced in October, the three companies aim to make Jatco a globally competitive manufacturer specializing in AT/CVT by integrating the AT/CVT operations at MMC's Kyoto and Mizushima plants into Jatco.
With the integration, Jatco will have an annual AT/CVT production capacity of some 3.3 million units, they said, adding it will boost capacity further to around 4 million units within a few years.
According to the agreement, MMC will first spin off its AT/CVT business and make it a wholly owned subsidiary, to be called Diamondmatic Co., on April 1.
In early July, Diamondmatic will become a wholly owned subsidiary of Jatco through a stock swap deal under which one Diamondmatic share will be exchanged for 1.31423 Jatco share.
At that point, Nissan's interest in Jatco will be around 82 percent, while MMC's stake will be 18 percent, the companies said.
Jatco and Diamondmatic will try to merge fully in the spring of 2003, they said.