The Hindu : Business : Tata completes JLR buyout

Online edition of India's National Newspaper
Tuesday, Jun 03, 2008
ePaper | Mobile/PDA Version

Business

Business

Tata completes JLR buyout

Appoints David Smith as Chief Executive Officer

Ties up with Ford for supply of engines and stampings
To cooperate in design and development

— PHOTO: AFP

COMPLETING FORMALITIES: David Smith (left), CEO, Jaguar Land Rover, and Ratan Tata, Chairman, Tata Sons, at a signing ceremony at Jaguar headquarters at Gaydon, West Midlands.

MUMBAI: Tata Motors on Monday said it had completed the $2.3-billion acquisition of British luxury brands Jaguar and Land Rover in an all cash transaction.

The acting Chief Executive Officer of Jaguar Land Rover David Smith would be the new CEO of the business, Tata Motors said in a statement.

In March, the Indian auto major had announced that it has entered into a definitive agreement with U.S. car-maker Ford to buyout the two British luxury brands.

Tata Sons and Tata Motors Chairman Ratan Tata was present at the handing over ceremony of Jaguar and Land Rover at the latter’s headquarters at Gaydon in the U.K..

Momentous time

“This is a momentous time for all of us at Tata Motors. Jaguar and Land Rover are two iconic British brands with worldwide growth prospects.

... Jaguar and Land Rover will retain their distinctive identities and continue to pursue their respective business plans as before,” Tata said in a statement.

Ford Motor’s Executive Vice-President and Chief Financial Officer Don Leclair and Executive Vice-President Lewis Booth, who is responsible for Europe, Volvo and JLR, were also present at the ceremony.

Bright future

“We are very pleased with the association with Tata Motors. We look forward to a sustained bright future for the company and its stakeholders,” Mr. Smith said.

The purchase consideration includes the ownership of Jaguar and Land Rover or perpetual royalty-free licences of all necessary intellectual property rights, manufacturing plants, two advanced design centres in the U.K., and worldwide network of national sales companies.

Tata Motors has also entered into long term agreements with Ford for supply of engines, stampings and other components to Jaguar and Land Rover.

According to the statement, other areas of transition support from Ford include IT, accounting and access to test facilities.

Both firms would continue cooperation in areas such as design and development through sharing of platforms and joint development of hybrid technologies and powertrain engineering.

Further, Ford Motor Credit Co would continue to provide financing for Jaguar and Land Rover deals to customers for a transition period.

The company is in advanced stage of negotiations with leading auto finance providers to support the Jaguar and Land Rover business in the U.K., Europe and the US. The financial services partners are expected to be selected shortly, the statement added. “We recognise the significant improvement in the performance of the two brands and look forward to this trend continuing in the coming years.

“It is our intention to work closely to support the Jaguar, Land Rover team in building the success and pre- eminence of the two brands,” Mr. Ratan Tata added.

Shares of Tata Motors closed at Rs. 562.95, down 2.42 per cent on the Bombay Stock Exchange. — PTI

Printer friendly page
Send this article to Friends by E-Mail

Business