Tata Motors acquired Jaguar and Land Rover from Ford in 2008. Ford was selling the brands because they had been losing money on them, posting $12.6 billion in losses in 2006. Tata hoped the acquisition would help them expand into the luxury vehicle market and European markets. The deal was valued at $2.3 billion. While Tata saw opportunities to grow Jaguar and Land Rover sales globally and diversify, integrating the luxury brands presented challenges as Tata had less experience with such brands and faced competition from established luxury automakers.

1. Merger and Acquisition
(Tata motors and Jaguar
&Land rover)
Name: JYOTI
Roll no. :27
Course: MBA

2. TATA -JAGUAR -LAND ROVER
DEAL

3. INTODUCTION TO THE TOPIC
Acquisition in general sense is acquiring the
ownership in the property.
When a company is acquired by another
company, the acquiring company has two
options:
• Merge both the companies into one and operate
as sing
Merger has been defined as an arrangement whereby
the assets of two or more companies become vested
in, or under the control of one company entity .

4. Overview

5. TATA MOTORS – A SNAPSHOT
• TATA GROUP is 150 year old, Previously Tata
Engineering and Locomotive Company, Telco.
• India's largest passenger automobile and
commercial vehicle.
• Tata Motors was established in 1945
• Listed on the New York Stock Exchange in 2004.

6. Jaguar and land rover
• Jaguar and land rover(informally JLR) is a british automotive
company.
• Jaguar in 1975 - Nationalized in due to financial difficulties
• 1990 - Taken over by Ford
• Founded in 1948 as a marquee of the Rover Company.
• Known for superior off-road performance, Used by
military for projects and expeditions, Safe but less reliable,
Makeover in recent times
• In 1994 Rover Group is taken over by BMW & sold to FORD
MOTORS for 2.75 bn$ in 2000

7. KEY ISSUES
• Ford acquired Jaguar for $2.5 billion in 1989.
• Ford acquired Land Rover for $2.75 billion in 2000.
• But the US auto major put the two marquees on the
market in 2007 after posting losses of $12.6 billion in
2006 - the heaviest in its 103-year history.

8. Why is Ford Selling?
• Reports said losses at Jaguar stood at USD 715
million in 2006.
• The Land Rover's profit, on the other hand, was
driven by the record sale of 2.26 lakh vehicles, an
18% growth in 2007.
• Bringing down production costs and turning
around the company successfully will be the
challenge-Its a test that Ford failed.
• Ford is combining both the brands

9. THE DEAL PROCESS
• 12/06/2007- Announcement from Ford that it plans to
sell Land Rover and Jaguar.
• August 2007 - Major bidders are identified
• Likely buyers: Tata Motors, M&M, Ceribrus capital
Management, TPG Capital, Apollo Management
• India’s Tata Motors and M&M arrive as top bidders ($ 2.05b
& $ 1.9b)
• 03/01/2008 – Ford announces Tatas as the preferred
bidders
• 26/03/2008 - Ford agreed to sell their Jaguar Land Rover
operations to Tata Motors.
• 02/06/2008 – The acquisition is complete

10. Tata Motors’ Financial Performance
(In Rs. Million)
Q3FY09 Q3FY08 9MFY09 9M FY 08
Revenue 47,586.2 72,518.3 187,659.2 199,813.0
EBITDA 916.5 8,197.4 11,186.3 21,608.6
Profit before Tax (4191.5) 6651.0 2839.5 18,784.2
Net Profit (2632.6) 4990.5 4098.4 14,926.5
Volume Summary
Total Commercial Vehicles 49,546 82,5568 195,192 215,313
Total Passenger Vehicles 42,187 49,284 142,507 153,475
Exports 7,027 12,756 29,177 40,488
Total Volumes 98,760 144,608 366,876 409,276

11. Why Tata acquire JLR?
• Long term strategic commitment to automotive
sector
• Opportunity to participate in two fast growing auto
segement
• Increased business diversity across market and
product
• Jaguar offer a range of “performance/luxury”
vehicles
• Benefits from component sourcing, design services
and low cost engineering.

12. Benefits
• Tata wanted to make a global impact and it thinks
that buying these brands at a lower rate now, will
give better value later on.
• This acquisition also eases the entry of Tata in
European market which it has been eyeing for long. A
previous JV with FIAT took place, this will further
help them penetrate EU market.

13. • Increase sales in emerging markets
• Reduce dependence on mature markets
• Opportunity to spread its business across
different customer segment
• Reduce the company dependence on the
Indian market which accounted for 90% of its
sales

14. SWOT
Strengths: Weaknesses:
Tata’s strong management Jaguar’s declining sales record
capability Inexperience of handling such
Strong monetary base to invest luxury brands
Tata’s Jaguar
Land Rover
Opportunities: Acquisition
Support from Ford in terms of
Technology,Engine, IT, Market is volatile and driven
Accounting by new products
Adding up of luxury brands in Strong presence of competitors
the product line like Mercedes, BMW, Lexus
Access to European Market and Infinity

15. Current status
• Jaguar Land Rover global sales in December 2009
were 21,134 vehicles, higher by 33%.
• Jaguar sales for the month were 4,794, higher by
5%, while Land Rover sales were 16,340, higher by
45%

16. THANK YOU