Struggling carmaker Mitsubishi Motors on Tuesday said it expected to raise 295 billion yen ($US2.7 billion) from a planned issue of new shares, slightly above a previously projected 280 billion yen.

“Mitsubishi group companies have agreed to give us more support than we had expected earlier,” a Mitsubishi Motors spokesman told Reuters.

The news agency noted that Japan’s fourth-largest car maker said last month that it had won $4 billion in emergency rescue funds, much of which would be paid for by its main shareholders in the Mitsubishi group, to shore up its balance sheet and fix its operations.

Under the revised capital increase scheme, seven Mitsubishi group companies and Taiwan’s China Motor Corp. would purchase a combined 35 billion yen in preferred MMC shares, 15 billion yen more than the earlier plan, the spokesman told Reuters.

Core group firms Mitsubishi Heavy Industries, Mitsubishi Corp., the Bank of Tokyo-Mitsubishi (BTM) and Mitsubishi Trust & Banking Corp, would buy a combined 130 billion yen in preferred shares as previously planned, the report added, while BTM and Mitsubishi Trust, both part of the Mitsubishi Tokyo Financial Group, will swap a combined 130 billion yen of debt owed by MMC into equity, also unchanged.

Reuters said the $4 billion package also includes 100 billion yen of preferred shares, which do not carry voting rights, to be bought by JP Morgan Chase.

Phoenix Capital, a Tokyo-based investment fund with close ties to the Mitsubishi group, is also expected to buy up to 100 billion yen in common stock for 100 yen a share – compared with 405 yen paid by partner DaimlerChrysler four years ago, the report added.

MMC’s shares finished Tuesday trade at 201 yen, Reuters noted.

The news agency said, if Phoenix takes 100 billion yen worth, it would become MMC’s top shareholder with around 40%, while DaimlerChrysler’s stake would fall to around 22 to 23% from 37%.

“We are still negotiating on the terms of the deals with JP Morgan and Phoenix Capital, with their payment due in mid to late July 2004,” the spokesman told Reuters.

The news agency noted that, in May, Mitsubishi Motors vowed a return to profit in the business year starting next April through a restructuring that would see it close a plant in Japan and cut its non-factory workforce by 30%, or 7,600 people, in three years to the end of March 2007.

Despite the plan, delayed for three weeks after major shareholder DaimlerChrysler backed out, MMC’s future remains uncertain as it struggles to repair its brand image, which is still tainted by a major recall scandal four years ago, Reuters said.