Mazda to raise $1.1bn; narrows loss forecast

       Mazda Motor Corp will raise as much as 96 billion yen ($1.1 billion)selling new and existing shares, as the company reported yesterday a smallerthan-predicted first-half loss.
       "Mazda will sell as many as 363 million new shares and 96.8 million existing shares held by the Hiroshima-based carmaker," it said in a statement to the Tokyo Stock Exchange."Mazda will use the funds to develop less polluting cars and improve its financial base."
       Mazda follows All Nippon Airways Co, Nomura Holdings Inc and Mizuho Financial Group Inc in raising cash by selling equity. The carmaker forecasts a second straight annual loss after the global recession cut automobile demand and a stronger yen reduced revenue from overseas sales.
       "Mazda needs money to survive,"said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments Ltd."It also needs funds to develop more fuelefficient cars."
       Goldman Sachs Group Inc, Nomura Holdings Inc and Daiwa Securities SMBC Co will manage the share sale, according to a Finance Ministry filing.
       The company posted a preliminary first-half net loss of 26 billion yen, compared with a prediction of 50 billion yen. It also narrowed its full-year loss forecast to 26 billion yen from 50 billion yen, citing government incentives that have stimulated car demand and a weaker yen against the euro.
       The forecast is based on an exchange rate of 132 yen to the euro, compared with 125 yen in the previous forecast,and 92 yen to the dollar, compared with 95 yen previously. The euro traded at 131.34 yen and the dollar at 89.83 yen as of 4.48 p.m. in Tokyo yesterday.
       The automaker raised its estimate for global vehicle sales this fiscal year to 1,155,000 from 1.1 million, after government rebates and tax cuts including the US cash for clunkers plan helped lift demand.
       Mazda's vehicle sales dropped 26%in the US and 23% in Japan through September this year. Sales in Europe fell 21% through August.
       The carmaker,13.8% owned by Ford Motor Co, has said it will improve fuel efficiency by 30% on average by 2015 compared with 2008 by introducing new gasoline and diesel engines.
       The company registered in July to sell as much as 100 billion yen of bonds within two years, according to a Finance Ministry filing.
       All Nippon Air, Asia's second-largest carrier, said in July it would raise as much as 142 billion yen selling new equity to buy planes, its first sale of shares since 2006.