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(Adds government confirmation)
TORONTO, Jan 12 (Reuters) - Canadian auto-parts manufacturer Linamar Corp will add up to 1,200 jobs at a facility in Guelph, Ontario, developing fuel-efficient transmissions, with 10 percent of the new investment paid by the Canadian government, the government said on Monday.
The government will make a C$50.7 million ($42.6 million)repayable contribution to Linamar's C$507 million investment, Industry Canada said in a release. It said Linamar would maintain at least 6,870 jobs at its facilities in Ontario.
Linamar has operations in the Americas, Europe and Asia. When it last reported financial results in November, the company said it had more than 19,000 employees and 45 manufacturing operations.
The government funding will come from the Automotive Innovation Fund, a program launched in 2008 to shore up the Canadian auto industry, hit hard by competition from abroad.
$1=$1.19 Canadian Reporting by Allison Martell; Editing by Jeffrey Hodgson, Lisa Von Ahn; and Peter Galloway