Following the earlier intimation that it might do so, Ford has officially announced that it is reducing its stake in Mazda to 3.5% from the 11% it currently owns, with the transaction expected to be completed by today.

The 7.5% will be transferred to Mazda’s business partners via off-auction trading through the Tokyo Stock Exchange. Ford’s decision to reduce its ownership stake in Mazda will allow it to increase flexibility as it continues to pursue growth in key emerging markets, specifically in China.

The US automaker, which will now be Mazda’s fourth-largest stakeholder after the sale, took a 25% stake in Mazda in 1979 and gained management control in 1996 when it increased its shareholding to 33.4%. In late 2008, in an effort to raise cash, Ford’s share in Mazda was reduced to 13%, and the stake dropped to 11% last year when Mazda issued new shares.

Both companies have agreed to continue their strategic partnership. “Ford will remain one of Mazda’s largest shareholders with a 3.5% stake, and both companies are committed to continuing our strategic partnership which spans over 30 years, and will continue to collaborate on areas of mutual benefit such as key joint ventures, joint projects and exchange of technology information,” Mazda’s CEO Takashi Yamanouchi said in a statement.