Oh what a feeling to say goodbye General!

Subaru has announced that it will sever its ties with US auto giant, General Motors… And replace them with new ties with Japanese auto giant, Toyota. That’s the upshot of today’s news from Subaru’s parent company Fuji Heavy Industries.

According to the FHI statement, GM has agreed to dissolve its strategic alliance and capital relationship with FHI. Accordingly, GM (the largest shareholder of FHI with an approximate 20 per cent holding) will sell its FHI stocks.

GM will divest 68m of its shares to Toyota, giving the Japanese giant a holding in FHI approaching 9 per cent. The remaining 89m shares GM currently holds will be bought back by FHI.

With the exception of the Saab 9-2/Subaru Impreza project already on sale in US and other markets (pictured above), no further joint GM-Subaru vehicles are likely to see the light of day. According to FHI’s statement the company will write-off five billion yen’s worth of costs this financial year, a large part of which relate to the development of a joint GM-Subaru crossover vehicle.

American sources have stated the sale of shares to Toyota is worth $US309m to GM. The value of the Fuji share buy-back will be depend on the open market value of the shares at the time of the buy-back. Meantime, the deal has reportedly allowed GM to restate its second quarter financials to show a $US700-$800m reduction in the carrying costs of its Fuji Heavy shareholding.

In preparation of the new alliance, Toyota and FHI have signed a deal to study “the synergic effects of business collaboration.”