(Bloomberg) -- Hitachi Ltd. and Honda Motor Co. are changing the ownership of their automotive component joint venture Hitachi Astemo Ltd., taking a 40% stake each and bringing in JIC Capital Ltd., which will own the rest of the parts supplier.

As a result, the stake held by Hitachi, one of the country’s biggest industrial conglomerates, will shrink from the two-thirds it currently holds in Hitachi Astemo. Honda’s ownership will rise by around 7%, the companies said in a statement Thursday. Hitachi Astemo will aim for an eventual public listing, they said.

The deal will let Hitachi remove Hitachi Astemo as a consolidated subsidiary and is in line with the company’s efforts to streamline operations and divest non-core assets. The move is also aimed at strengthening Hitachi Astemo’s position as a supplier at a time when the twin forces of electrification and automation are disrupting the global auto industry. 

“The automobile and motorcycle industries are currently facing a revolution,” the companies said in the statement. Hitachi Astemo will seek to accelerate “investment in advanced technologies such as electric powertrains for automobiles, autonomous driving/advanced driver assistance systems, advanced chassis and next-generation motorcycles.”

Hitachi shares rose less than 1% on Friday, while Honda’s stock climbed 1.2%.

Honda, Japan’s second-biggest carmaker, and Hitachi agreed in 2019 to merge their car-parts businesses to create a components supplier with about ¥1.8 trillion ($13.6 billion) in sales. 

Hitachi has been selling off and merging non-core units as it focuses on growth from information technology systems. The company said it will post an extraordinary unconsolidated gain of about ¥108 billion for the fiscal year ending March 2024, or ¥94 billion on a consolidated basis. 

Honda is not likely to see any impact on its consolidated financial results for the current fiscal year, which ends this month, the carmaker said in a statement.

(Updates with share reaction.)

©2023 Bloomberg L.P.