Advics, a Japan-based supplier of braking systems to Toyota, is to raise capital in order to boost its production capacity.
Nikkei reported that the company will issue more than 10 billion yen (around US$90m) in new shares to produce funds for investment in plant and equipment.
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The company was established in 2001 as a joint venture among Toyota, Denso, Aisin Seiki and Sumitomo Electric Industries.
The new shares will be sold directly to existing shareholders, Nikkei reported, with Aisin remaining the majority stakeholder, while fellow autoparts maker Denso will gain the power to veto major decisions by Advics as its stake rises to more than one-third from 18% currently.
The report added that Denso will bolster cooperation with Advics in order to compete better against global giants such as Bosch.
A group of automakers reached an agreement with the US National Highway Traffic Safety Administration last month to make an automatic emergency brake system standard on all of their vehicles by 2022. The agreement is stimulating some reorganisation in the braking sector and adding competitive concerns for a number of players looking to exploit the new opportunity.
