Tata Motors has closed a deal to buy Ford’s Jaguar and Land Rover brands for $US2.65bn, according to Indian media reports.
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According to Reuters, Indian news channel NDTV Profit, citing unnamed sources, said on Tuesday the deal would be announced around midnight Indian time (18:30GMT).
However, a Tata Group spokesman told the news agency discussions were still going on and the company had no guidance to give on the deal.
“We have nothing to tell you now,” he told Reuters.
A source with knowledge of the deal told just-auto Ford planned an announcement at 12:00GMT on Wednesday – late afternoon in India and ahead of the 9am New York stock exchange opening in the US.
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By GlobalDataAccording to Reuters, CNBC TV-18, also citing unnamed sources, said the deal was likely to be signed on Wednesday and details of the agreement would be known only after the sale purchase agreement was signed by Tata Motors.
Ahead of the TV report, shares in Tata Motors rose 2.7% to a three-week closing high of 679.95 rupees, in a Mumbai market that surged 6.1%, Reuters added.
The news agency said Tata Group chairman Ratan Tata and Tata Motors managing director Ravi Kant were scheduled to hold a media conference on the company’s pick-up trucks at the Bangkok motor show on Thursday.
On Monday, Kant declined to answer questions on the Ford deal at a function in Mumbai for Fiat India Automobiles, the Indian joint venture between Tata and Fiat, Reuters said.
The Financial Times had on Monday said Ford would announce the sale of the brands to Tata for about $2bn on Wednesday, a day sources had previously told Reuters was a likely date for the deal.
Sources close to the deal told Reuters last week that Ford was expected to announce the sale this week, meeting Ford’s target of closing the deal by the end of the first quarter.
Tata is launching a $3bn syndicated loan, and also said this month that it planned to raise up to $1bn in overseas and/or domestic markets, Reuters said.
Analysts have told the news agency the global liquidity crunch could make the deal more expensive than Tata initially planned, as the cost of borrowing has risen 200-300 basis points since last July when the Indian automaker’s interest in the brands first surfaced.
Analysts have also expressed doubts about how Tata will incorporate the luxury brands into its stable of sturdy trucks and functional passenger cars, including the Nano, the world’s cheapest car which it unveiled in January, Reuters added.
