Troubled Mitsubishi Motors is in final talks with some of its biggest shareholders to find R27 billion in aid to boost its coffers and fund development.

Troubled Mitsubishi Motors is in final talks with some of its biggest shareholders to find R27 billion in aid to boost its coffers and fund development.

The corporation desperately needs cash to fund its new models and complete its restructuring after DaimlerChrysler last month decided not to proceed with the refunding plan for the ailing motor manufacturer.

Since DaimlerChrysler's board made the shock decision, the Mitsubishi Motor Corporation (MMC) has been negotiating with its other big shareholders, including Mitsubishi Corporation, Mitsubishi Heavy Industries and the Bank of Tokyo, to save the company.

According to a Reuters report, the new plan being tabled involved the three companies each taking R4.42 billion of newly issued preferred shares, while other Mitsubishi group companies would take more than a combined R1,8 billion in shares.

The Mitsubishi group, which holds about 32 per cent of MMC, will supply more than R9 billion, the Reuters report stated.

As part of MMC's restructuring, one of its under-utilised domestic plants will close and production will be transferred to another plant in central Japan. Job cuts are expected at MMC plants in the US, Australia and Japan, as well as at its Japanese headquarters.

To reduce vehicle development costs, Mitsubishi Motors will also discontinue some models other than its core small cars and sport utility vehicles.

Original article from Car