Tata Motors to acquire Italian CV major Iveco for ₹30,800 crore
Iveco Group Board has recommended Tata Motors' all-cash voluntary tender offer for Iveco Group common shares. This call-cash deal will be funded through a bridge loan to be repaid in four years and Tata Motors has announced to raise €I billion in equity to fund this acquisition, chief financial officer P.B. Balaji told journalists.
This will be Tata Motors' biggest acquisition, once complete. In 2008 the company had acquired Jaguar Land Rover for $2.3 billion. Mr. Balaji said this Iveco deal would be one of the top acquisitions of the Tata Group which had earlier acquired Corus and Tetley besides JLR and Daewoo Commercial Vehicles.
The completion of the offer is conditional on the separation of Iveco's defence business.
Together, Iveco and the commercial vehicle business of Tata Motors will have combined revenue of ₹2,20,000 crore split across Europe, India and the Americas with attractive positions in emerging markets in Asia and Africa.
Natarajan Chandrasekaran, Chairman, Tata Motors in a statement said, 'This is a logical next step following the demerger of the Tata Motors Commercial Vehicle business and will allow the combined group to compete on a truly global basis with two strategic home markets in India and Europe.'
'The combined group's complementary businesses and greater reach will enhance our ability to invest boldly. I look forward to securing the necessary approvals and concluding the transaction in the coming months,' he said.
Suzanne Heywood, Chair of Iveco Group said this this strategically significant combination brings together two businesses with a shared vision for sustainable mobility.
'Moreover, the reinforced prospects of the new combination are strongly positive in terms of the security of employment and industrial footprint of Iveco Group as a whole,' he added.
Girish Wagh, Executive Director of Tata Motors said, 'This combination is a strategic leap forward in our ambition to build a future-ready commercial vehicle ecosystem. Together, we are shaping a resilient and agile enterprise, equipped to lead in times of transformative change.'
Tata Motors has offered to acquire 100% of Iveco's common shares with a subsequent delisting of Iveco Group from Euronext Milan.
Tata Motors will be able to achieve full ownership of Iveco through a pre-agreed transaction upon reaching 80% in the Offer.
Upon successful completion of the offer, it is envisaged that two members of the Iveco Board will serve as independent board members and will monitor compliance with, amongst other things, the Non-Financial Covenants (NFC).
The Iveco Board will continue to drive decisions for long-term growth and maintaining the competitiveness of the business. Tata Motors will remain committed to respecting and maintaining Iveco Group's corporate identity, integrity, core values, and culture as well as Iveco's key brands, trademarks, and logos.
Iveco Group's headquarters will remain in Turin, Italy. Tata Motors will be committed to the long-term development of the combined group and will not implement any material restructurings or close any plants or factories owned or used by Iveco Group as a direct consequence of the combination and, in any case, during the period of the NFC.
It will respect the existing rights and benefits of the employees of Iveco Group, including those outlined in the relevant employment and pension agreements and plans as well as existing arrangements with employee representative bodies.
Iveco Group, together with its subsidiaries, will continue to have its own operating and reporting structure, with the Iveco Board managing the Iveco Group and its businesses. The Board of Iveco will continue to drive decisions for long-term growth and the competitiveness of the business.
The deal is expected to close in Q2 2026. With Iveco in its fold, Tata Motors will now be a global commercial vehicles player and compete with Volvo and Daimler.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
44 minutes ago
- Time of India
Tesla sales in Portugal slump 48.5% in July, total EVs rise
Tesla's new car registrations in Portugal fell 48.5 per cent in July from a year ago to 284 units, as overall new registrations of light electric vehicles rose about 9.5 per cent , the country's automobile industry association ACAP said on Friday. In the January-July period, Tesla sales fell 27.4 per cent in Portugal to 4,372 units, while the total of light electric cars rose 27.2 per cent . Data from several other key European markets earlier on Friday showed Tesla registrations fell in July despite a revamp to its signature Model Y, as the EV maker struggles with a backlash to CEO Elon Musk's political views, regulatory challenges and rising competition.
Time of India
44 minutes ago
- Time of India
What are the main issues facing new Renault CEO Provost?
Incoming Renault CEO Francois Provost will take the helm of the French automaker at a time when it is beginning to show cracks in its recent success, revising down its full year profit forecast earlier this month due to weaker sales volumes. Below are some of the challenges ahead for Provost when he takes over on Thursday: Tougher competition While Renault has been largely protected from U.S. tariffs because it does not sell in the United States, it has been indirectly hit by increased commercial pressure as European competitors looking for new markets outside the U.S. step up efforts to sell in the French firm's home region. The company reported zero growth in second quarter sales volumes, and warned of weak sales performance in June. It is also facing rising competition from Chinese entrants, both in electric vehicles and hybrids. Analysts at Barclays say Renault may have seen slower price-mix momentum in the first half of the year. The company is scheduled to report full results for the first half on Thursday. Dependency on Europe and cars With sluggish growth in Europe where Renault sells more than 70% of its cars, it needs to expand in emerging markets. It has already outlined plans to invest 3 billion euros ($3.4 billion) to launch eight new models under the Renault brand for non-European markets by 2027. It will also target developing less cyclical businesses beyond autos, such as EV charging and financial services, as part of a mid-term strategy which former CEO Luca de Meo had aimed to unveil later this year. Too small, less independent Conscious that its small size does not allow it to fund the development of electrified and autonomous vehicles, Renault has set up numerous partnerships, including with China's Geely in Korea and in combustion and hybrid engines around the world, and with Volvo Group in electric vans. However, this strategy has raised concerns among unions that the company could lose its in-house know-how and its independence. Renault, ranking only 15th in volumes globally, is frequently the subject of rumours of a tie-up with larger peer Stellantis. Partnerships with Geely also have some worried about potential leverage by China, though Renault's main shareholder, the French state, says the tie-ups do not compromise the company's ability to remain independent. A high place of launches Under de Meo, Renault launched one of the biggest product renewals in its history, with a record 10 launches and two facelifts last year. It is planning another seven launches and two facelifts in 2025, including of the Renault 4 and the Dacia Bigster, and eight more in 2026, according to sources familiar with the matter. Key to increasing market share, new launches also require significant investment in marketing and industrial fine-tuning to deliver cars on time, at the right quality. Van hoes A leader in Europe's high profit commercial vehicles market, Renault's van sales plunged by 29% in the first half due to a softer economy, and an overhaul of its models and product offering. Getting back to investment grade One of Renault's top priorities is to get its credit rating back to investment grade to attract new investors, while also boosting its market cap, currently only at 10 billion euros versus Stellantis' 23 billion euros. Renault's debt is rated Ba1 by Moody's and BB+ by S&P Global, one notch below investment grade. Nissan Since starting to rebalance its partnership with Nissan in early 2023, Renault has done three share sales, and reduced its stake in its Japanese partner to 35.7% (17.05% held directly and 18.66% via a trust). It will need to find the right time to sell more, made more challenging by Nissan's financial and operational difficulties. It will also play a role in Nissan's overhaul, particularly if the Japanese company decides to sign a strategic partnership with another manufacturer. Renault opposed recent plans for a tie-up with Honda because it considered the financial terms were not generous enough.
Economic Times
an hour ago
- Economic Times
Car sales inch up in July after two-month slump; industry pins hopes on festive cheer
Agencies Representative image Domestic passenger vehicle sales rose about 1% in July, marking a slight recovery after two straight months of decline, amid persistently sluggish consumer are cautiously optimistic that sales will accelerate further during the coming festive season, starting with Onam in many as 348,000 cars, sedans, and utility vehicles were dispatched from factories to dealerships last month, compared with 344,000 vehicles in July 2024, according to industry estimates. Retail sales were flat at about 328,000 vehicles last month. At the country's largest carmaker Maruti Suzuki, wholesale volumes were largely unchanged at 137,776 vehicles last month. Partho Banerjee, senior executive officer (marketing and sales) said while Maruti has seen an uptick in bookings ahead of the festive season, starting with Onam in Kerala, conversions are slow. 'Growth in rural markets which stood at about 10% last year, has now come down to 2-3%. In urban areas, with layoffs in the IT sector, buyers are cautious,' Banerjee said, adding, 'We have, however, seen an increase in bookings which is a positive sign.' 'With the advent of the festive season, as things stabilise, we expect the demand momentum to pick up,' said Banerjee. Maruti Suzuki has so far recorded a 10% increase in bookings in Kerala. Korean rival Hyundai Motor India too saw sales dip by 10% to 43,973 vehicles in July. Tarun Garg, chief operating officer, said, 'While the overall auto industry has seen some softness in recent months, we remain optimistic with the onset of the festive season and are fully geared up with robust supply and product offerings.'Meanwhile, Tata Motors saw passenger vehicle sales decline by 12% to 39,521 units last month. At Toyota Kirloskar Motor too, sales fell by 1.2% to 29,159 vehicles in July. Mahindra & Mahindra (M&M) and JSW MG Motor India were among the few to buck the sluggish industry trend, recording an increase in wholesale volumes in July. While sales at Mahindra climbed 20% to 49,871 vehicles, JSW MG posted a 46% surge to 6,678 vehicles. Nalinikanth Gollagunta, CEO (automotive division) at M&M said, 'Our SUV growth has been supported by the recent launch of XUV 3XO 'REVX' Series & the commencement of deliveries for Pack two variants of the BE 6 and XUV 9E models.' In the commercial vehicle segment, market leader Tata Motors posted a 4% sales growth at 26,432 units in July. Chennai-based Ashok Leyland recorded a similar 4% rise to 13,501 units while VE Commercial Vehicles' sales of Eicher branded trucks and buses grew 6% to 6,410 units. Two-wheeler sales remained healthy in the month under review. At TVS Motor Company, domestic two-wheeler sales increased 21% to 308,720 units in July. Royal Enfield reported a 25% growth at 76,254 units. In the farm equipment segment, market leader M&M sold 26,990 tractors last month, a 5% increase from a year earlier.'This performance was driven by sustained land preparation activities, supported by robust cash flows in rural markets following the conclusion of Rabi crop harvesting," said Veejay Nakra, president (farm equipment business) at M&M. 'Additionally, the normal progression of monsoon across most regions further contributed to good demand during the onset of sowing for the Kharif season."
