Toyota raises stake in Fuji Heavy to almost 17%

DETROIT, USA -- Fuji Heavy Industries Ltd., the maker of Subaru cars, will sell 61 million shares valued at 31.1 billion yen ($293 million) to Toyota Motor Corp., boosting Toyota's stake to 16.61 percent.

Toyota, the world's largest automaker by sales, currently holds a 9.5 percent stake in Fuji Heavy, making it the company's top shareholder.

The strengthened ties between Toyota and Fuji Heavy come as a number of major automakers are looking to strike partnerships to offset the cost of developing new cars and technology and to boost production in factories facing slack demand.

Subaru and Toyota are already cooperating in hybrid technology, an area where Toyota leads the market.

The increased investment by Toyota also highlights the auto industry's changing fortunes as General Motors, Toyota's largest rival in global sales, faces increasing pressure to shed assets and raise capital to restructure.

GM sold a stake of just over 20 percent in Subaru in 2005, one of string of asset sales by the automaker over recent years that also included stakes in Suzuki Motor and Isuzu Motors.

The sale of shares to Toyota is expected to be completed on July 14, Fuji Heavy said in a statement released in Tokyo.

[Source : Reuters via Automotive News]