TOKYO -- Ailing U.S. auto maker Ford Motor Co. said it will sell a 20% stake in Mazda Motor Corp., ending 12 years of control of the Japanese auto maker as it struggles to shore up its finances and seeks aid from Washington to stay afloat amid slumping auto sales.

Ford will net about $540 million from the sale, money that it says is needed to strengthen its balance sheet but a fraction of the $7.7 billion in cash the auto maker burned through in the third quarter as its revenue dropped due to rapidly deteriorating conditions...