Ford Motor has raised $540 million after selling the bulk of its 33.4 percent stake in Mazda.

Ford's ownership of Mazda stock has been reduced by 20 percentage points to just over 13 percent, the company said today.

The sale means that Ford will end 12 years of control of Mazda. The U.S. carmaker first took a stake in the Japanese carmaker in 1979.

Mazda jettisoned two of the three executives Ford had installed on its board to better reflect Ford's diminished stature. Meanwhile, CEO Hisakazu Imaki named 41-year veteran and purchasing head Takashi Yamanouchi his successor, effective November 19. Imaki -- Mazda's first Japanese CEO after a string of four Ford executives -- will become chairman.

"Essentially what this means is that Mazda is a Japanese company again," spokeswoman Yukari Hara said after Mazda called a snap press conference to announce the sell off.

Ford is the latest American automaker dumping stakes in more prosperous Japanese partners to generate badly needed operating funds back home. Just a day earlier, General Motors said it was giving up its 3 percent stake in Suzuki for about $230 million.

Ford said it would continue its partnership with Mazda despite reducing its holding to 13 percent from 33.4 percent.

Mazda and more than 20 of its business partners have bought the Ford shares.

"This agreement allows Ford to raise capital that will help fund our product-led transformation, and at the same time, allows Ford and Mazda to continue our successful strategic relationship in the best interest of both companies," said Ford CEO Alan Mulally in a statement.

Ford and Mazda will continue their joint ventures as well as the sharing of platforms and powertrains.

Ford will remain Mazda's largest shareholder.

As part of the ownership change, Mazda said two board members would return to Ford, while Ford executive Philip G. Spender will stay on Mazda's board as a representative director and executive vice president.

David E. Friedman and Daniel T. Morris have been sent back to Ford. They were replaced by homegrown Mazda executives.

"The sale of Mazda shares by our partner, Ford, will not result in any change in Mazda's strategic direction and we will continue to accelerate our product-led brand improvement and cost innovation initiatives," Mazda's Imaki said.

Reeling from slowing sales, Ford, GM and Chrysler are desperately trying to raise cash to stay alive through the worst economic crisis since the Great Depression.

Slowing auto sales and the global financial crisis have sent shares of Ford plunging, and its coffers are depleted. It reported a worse-than-expected $2.98 billion quarterly operating loss this month.

Mazda's shares jumped on an earlier Nikkei business daily report that the announcement could come on Tuesday. The stock ended the day 6.4 percent higher at 184 yen.

Ford first took an equity stake in Mazda in 1979 and brought it under its control in 1996 as the Hiroshima-based carmaker struggled to survive.

The partners share vehicle platforms and engineering resources and jointly own assembly plants in the United States, Thailand and China.

Imaki declined to disclose the other buyers of its shares, saying only that there were more than 20 companies.

Media reports have named trading houses Sumitomo Corp and Itochu Corp, auto partsmaker Denso Corp, non-life insurance companies including Tokio Marine Holdings Inc as possible buyers.

Mazda, which had cash or cash equivalents worth 215 billion yen at the end of September, said it would use its own funds to buy back the shares on Wednesday at Tuesday's closing price of 184 yen.

Analysts have said they expected little short-term change to the relationship between Ford and Mazda given their closely intertwined operations and platform-sharing. Some say having a more stable set of shareholders would be positive for Mazda.

Earlier this year, Ford sold the premium Jaguar and Land Rover brands to India's Tata Motors Ltd and is said to be looking for a buyer for its Volvo Cars arm.

Reuters contributed to this report

PRESS RELEASE: FORD SELLS A PORTION OF ITS STAKE IN MAZDA; TWO COMPANIES WILL CONTINUE STRATEGIC RELATIONSHIP

* Ford Motor Company said it will sell a portion of its ownership stake in Mazda Motor Corp., and the two companies will continue their successful strategic relationship. The ratio of Ford's ownership of Mazda stock has been reduced from 33.4 percent to just over 13 percent.

* The action is in line with Ford's plan to strengthen its balance sheet and ensure it has the resources to fund its product-led transformation plan focusing on the Ford brand worldwide.

* Under the new agreement, Ford and Mazda will continue their ongoing joint ventures, as well as the sharing of platforms and powertrains. Ford and Mazda's nearly 30-year relationship has been and continues to be an effective way to utilize the resources of both organizations and maximize joint synergies.

* The divestiture of Ford's shares in Mazda will be accomplished both through the sale of shares to Mazda and the sale of shares to a group of Mazda's strategic business partners.

DEARBORN, Mich., November 18, 2008 – Ford Motor Company today announced it has entered into an agreement to sell a portion of its stake in Mazda Motor Corp. and that the two companies will continue their successful strategic relationship that spans nearly 30 years.

In line with Ford's plan to strengthen its balance sheet and ensure it has the resources to implement its product-led transformation plan focusing on the Ford brand worldwide, the company said it is reducing its stake in Mazda from 33.4 percent to just over 13 percent.

Under the agreement, the divestiture of Ford's shares in Mazda will be accomplished both through the sale of shares to Mazda and the sale of shares to a group of Mazda's strategic business partners. The sales of the Mazda shares will net Ford approximately $540 million.

"This agreement allows Ford to raise capital that will help fund our product-led transformation, and at the same time, allows Ford and Mazda to continue our successful strategic relationship in the best interest of both companies," said Ford President and CEO Alan Mulally. "Ford will continue to focus on the Ford brand worldwide and deliver the products our customers really want and value."

Ford and Mazda will continue their ongoing joint ventures, as well as the sharing of platforms and powertrains. Ford will remain Mazda's largest shareholder and will maintain a seat on Mazda's Board of Directors.

"The sale of Mazda shares by our partner, Ford, will not result in any change in Mazda's strategic direction and we will continue to accelerate our product-led brand improvement and cost innovation initiatives," said Mazda Chairman, President and CEO Hisakazu Imaki. "We will continue our strategic relationship through our ongoing joint ventures with Ford, as well as the sharing of platforms and powertrains."