- Tata Motors has formally opened its €3.82 billion cash offer for Iveco’s commercial-vehicle business.
- The acquisition would create a manufacturer selling more than 590,000 vehicles annually.
- Both companies sell trucks and buses in Africa, while Tata has assembly operations in seven African countries.
- Neither company has disclosed how their African factories, dealerships or brands would be combined.
TheFinancial Express reported that the cash offer will open for shareholder acceptance on 7 September and run until 26 October, following approval from Italian market regulator Consob
Tata is offering €14.10 for each Iveco common share and ultimately intends to acquire 100% of the company and delist it from the Milan stock exchange
Iveco’s largest shareholder, Exor, has committed to tendering its 27.06% interest. Iveco’s board has also recommended that shareholders accept the proposal
The transaction is principally presented as a combination of Tata’s strength in India and other emerging economies with Iveco’s larger European commercial-vehicle operation. Its African consequences, however, extend beyond the 14% of combined revenue expected from markets outside Europe, India and South America
Two established African networks
Tata says it has sold more than 340,000 commercial vehicles across sub-Saharan Africa and operates more than 320 sales and service locations
Its wider African industrial network includes assembly operations in South Africa, Kenya, Nigeria, Senegal, Egypt, Morocco and Tunisia
Iveco separately sells and supports light vans, heavy trucks, buses and construction vehicles in African markets. Its vehicles are used by transport companies, mines, building contractors, municipalities and emergency services
Completion of the takeover would therefore give Tata control of overlapping product lines and distribution networks
That could create efficiencies in procurement, financing, technology and spare-parts distribution. It could also force decisions about which brands, factories and dealerships receive new investment
No such African restructuring has been announced
Defence business is not included
The transaction does not include Iveco’s defence operations
Under the, completion depended on separating that business from the commercial-vehicle group
Iveco subsequently transferred the IDV and ASTRA defence operations to Leonardo under a separate €1.7 billion transaction. Tata’s offer therefore covers the remaining truck, bus, powertrain and financial-services businesses
The companies expect their combination to produce annual sales exceeding 590,000 vehicles and revenue of approximately €21 billion
Tata has said Iveco will retain its headquarters in Turin. It has also made two-year commitments against closing major facilities or cutting jobs as a direct consequence of the takeover
It is not yet clear how far those protections extend to assembly plants, distributors and employees outside Europe