GM Reportedly Sought Control of Isuzu

General Motors Co. proposed buying more than one-third of Isuzu Motors Ltd. but scaled back its goal to a smaller stake when the Japanese company objected to the size of the original offer, Reuters reports.

The news service, which cites an unidentified source, says Isuzu told GM it wants to remain independent. Under Japanese rules, 33.4% is a controlling interest in a company. A stake of that size would cost about $3 billion, according to Reuters. It says talks are at an early stage.

The news service did not say when GM approached Isuzu or how much equity it is now seeking. The Nikkei has reported that the auto giant aims to buy a 10% stake. Isuzu says it is talking to a number of potential partners, including GM which hasn't commented.

GM wants to tap Isuzu's diesel technology and strength in southeast Asia markets, according to Reuters. It says Isuzu needs a partner to share the cost of developing hybrid systems and other fuel-efficient technologies.

The two companies had a 35-year equity alliance that ended in 2006 when GM sold its remaining 7.9% stake in Isuzu. Toyota Motor Corp. bought 5.9% of Isuzu's stock later that year. The goal was to jointly develop small diesel engines, but the project was scrapped during the global recession.