Shanghai (ZXZC)- Changan Mazda, currently a 50/50 joint venture between Chongqing Changan Automobile Co., Ltd. (Changan Auto) and Mazda Motor Corporation (Mazda), will be restructured by introducing FAW Group as a new investor, signifying the final solution to the long-rumored combination of Mazda's two Chinese joint ventures.

According to a statement jointly issued by Changan Auto, Mazda, and FAW Group on Aug. 24, the Changchun-based state-owned automaker will acquire 5% stake in Changan Mazda at an assessed consideration of the 60% equity interests it holds in FAW Mazda Motor Sales Co. Ltd. (FMSC). After completion of relevant regulatory procedures, the equity proportion of two existing shareholders will be each diluted to 47.5%.

Changan Mazda filed a request with China's top market regulator to acquire 100% stake in FAW Mazda Motor Sales Co. Ltd. (FMSC), according to a document published on August 17 via the website of the Anti-Monopoly Bureau of China's State Administration for Market Regulation (SAMR).

FAW-Mazda CX-4; photo credit: FAW-Mazda

The update shows that Changan Mazda, Mazda Motor, and FAW Group have signed several agreements under which Changan Mazda will purchase the entire equity interests FAW Group and Mazda Motor hold in FMSC, at consideration of cash and shareholdings.

Upon completion of the transaction, FAW Mazda will become a wholly-owned subsidiary of Changan Mazda. As Mazda Motor's only China joint venture in the future, Changan Mazda will see great expansion of its production lineups and dealership network.

Founded on Nov. 30, 2012, Changan Mazda is dedicated to the R&D, production, and sales of Mazda-branded passenger vehicle (PV) models, including the Mazda3 Axela, the Mazda CX-5, and the Mazda CX-8. FMSC was established in Jan. 2005 and focuses on the sales and after-sales services of Mazda-branded PVs, auto parts, and maintenance tools. The main models it sells include the Mazda6 Atenza and Mazda CX-4.

The combination of Changan Mazda and FMSC's sales channels will start at the end of August this year, according to a local media outlet, citing a dealer of FMSC. Nevertheless, the existing sale and after-sale services for FMSC's consumers will not be affected temporarily.