Mitsubishi Motors Corp. spun off its truck and bus business into a wholly owned subsidiary Monday in a bid to focus its resources on car operations.
The new company, Mitsubishi Fuso Truck and Bus Corp., expects group sales of 700 billion yen for the year to March 31, making it the third-largest Japanese commercial vehicle maker in terms of sales after Isuzu Motors Ltd. and Hino Motors Ltd.
DaimlerChrysler AG, which owns 37.3 percent of MMC, will take a 43 percent stake in MFTBC, for about 89 billion yen in March, MMC said.
The direct investment by DaimlerChrysler will enable MFTBC to reap the benefits of economies of scale and tap into DaimlerChrysler's knowledge and technology more directly, MMC said.
At the same time, Mitsubishi Corp., Mitsubishi Heavy Industries Ltd., Bank of Tokyo-Mitsubishi and other Mitsubishi group companies will take a combined 15 percent stake in MFTBC for 31 billion yen, reducing MMC's stake to 42 percent, MMC said.
MMC plans to use proceeds from the sale of its shares to help reduce interest-bearing debts by more than 300 billion yen from some 1.3 trillion yen on a group basis, MMC officials said.
Takashi Usami, a former vice president of MMC, will be chairman of the new company, and Wilfried Porth from DaimlerChrysler is the president.
The new company will be able to reduce costs by expanding global purchasing capabilities, jointly investing in new advanced technologies such as environmental technologies, and collaborating on the development and sharing of vehicle chassis and components, MMC said.