Carmakers Honda, Nissan enter a basic agreement for merger talks

The company plans to repurchase as many as 1.1 billion shares, or almost 24% of its stock excluding treasury securities.

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The large buyback is being launched now because such transactions face regulatory limits while merger talks are under way, the companies said.

The question of whether the merger can actually help save Nissan looms over the effort.

It's facing the starkest version of the existential threat all Japanese car companies are seeing amid the global automobile industry's breakneck shift to battery-powered electric vehicles and hybrid drivetrains, and away from combustion engine cars.

In China, the soaring popularity of locally made EVs has foreign brands fighting for survival, and Japanese carmakers there are stuck with too much capacity. Honda and Nissan have both had to pare back staffing and production, while Mitsubishi Motors has all but extricated itself from China, the world's biggest car market.

Meanwhile, a rebound in sales of hybrid gas-electric cars in North America has left Nissan on the back foot, while Toyota, a pioneer in hybrid technology, has received a welcome boost.