Tata gets US antitrust OK for Jaguar, Land Rover

US antitrust authorities have cleared India's Tata Motors Ltd's purchase of Jaguar and Land Rover from Ford Motor Co.Antitrust authorities completed their review of the $2.3 billion deal without taking any action to block it, the U.S. Federal Trade Commission.

In March, Tata announced it would buy Jaguar and Land Rover, giving the Indian automaker a line-up of products ranging from the world's cheapest car to some of the most expensive.

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Tatas plan to raise $983 million in Japan

Tata Motors Ltd plans to list depositary receipts on the Tokyo Stock Exchange, and may raise more than 100 billion yen ($983 million) in Japan for acquisitions.Tata, India's top vehicle maker, last week announced a deal to buy luxury brands Jaguar and Land Rover from Ford Motor Co for about $2.3 billion(Related Story). Later this year it plans to start selling the Nano, the world's cheapest car at about $2,500.

A spokesman for Tata Motors, India's top vehicle maker, said he could not comment on the Nikkei report immediately. Tata Motors last month signed a deal for a $3 billion one-year bridge loan, which it has indicated it would use for Jaguar and Land Rover deal.

It also said it would raise additional long-term funds of up to 40 billion rupees ($1billion). The Nikkei said Tata will list depositary receipts on Tokyo's largest bourse as early as this summer to finance acquisitions, becoming the first overseas firm to do so after restrictions were lifted last year.

Tatas may sell stake in HV Axel, HV Trans

To fund its Jaguar Land Rover (JLR) buyout, Tata Motors, is preparing to divest stake in two of its 100 per cent owned business units — HV Axel and HV Transmission.

According to sources, Tata Motors has been in talks with automotive firms, which include an international transmission giant. The company, according to officials, is unlikely to offload a majority stake in both the profitable subsidiaries.

Ford sells Jaguar/Land Rover to Tata-source

U.S. automaker Ford has agreed to sell its luxury brands Jaguar and Land Rover to India's Tata Motors for more than $2 billion, according to a source familiar with the matter. Ford, which signed the deal on Tuesday, plans to publicly announce the transaction in New York at 0800 EST on WednesdayThe deal will also see Ford pay about 300 million pounds ($598 million) into Jaguar and Land Rovers' pension funds, according to unions. Ford declined to comment.

Tata, India's top vehicle maker, has been in talks with Ford since it was chosen as the frontrunner to buy Jaguar and Land Rover a few days into 2008. Tata is pursuing the deal to gain a substantial foothold outside India. But analysts have questioned 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.

While Land Rover has generated three years of record sales with its iconic SUVs, the fit of Jaguar is far less clear. Ford, which lost $2.7 billion in 2007 and $12.6 billion in 2006, is spinning off Jaguar and Land Rover to focus on turning around its loss-making operations in North America.

The sale will include a commitment by Tata to continue buying engines from Ford, according to unions. All Jaguar and Land Rover's petrol engines are built in a Ford plant in South Wales, supporting hundreds of jobs there.

Read more in The Economic Times article.

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SBI, others to raise $3 bn for Tata Motors

State Bank of India (SBI) led consortium will raise $3-billion loan by April for Tata Motors’ acquisitions abroad, including the $2-billion Jaguar and Land Rover deal.Apart from SBI, the consortium will include leading entities like Citibank, Standard Chartered, BNP Paribas, JP Morgan, Tokyo Mitsubishi UFJ and Mizuho Financial Group, a source said. The country’s largest lender is also in talks with two-three public sector banks to be a part of the consortium, the source said.

Though the exact amount financed by each member could not be ascertained, it is understood to be equally contributed by all banks, around $37.5 million, by each entity in the consortium.Financiers in the consortium will normally receive commissions in the range of 0.50-1% of the deal amount, but it may vary according to the period of funding and the amount to be raised.

Read more in

The Economic Times article.

Tata Motors to raise $1 bn long-term funds

Tata Motors Ltd, top bus and truck maker, said on Tuesday it planned to raise additional long-term funds of up to 40 billion rupees ($1 billion).Tata Motors is in negotiations to buy Ford Motor Co's luxury UK brands Jaguar and Land Rover.

Ford to retain upto 50% in Jaguar, Rover biz

The line-up of suitors, including Tata Motors, Mahindra & Mahindra and a slew of private equity players, currently circling Ford’s Jaguar and Land Rover brands may not need to pick up the ailing businesses at one fell swoop.

According to auto analysts quoted in international media, Ford is planning to retain a 30-50% holding in the Jaguar and Land Rover businesses, the backbone of Ford’s luxury stable.

By opting not to sell the entire stake, Ford may, in fact, make it somewhat easier for the deal to go through because it may substantially reduce the acquisition cost for any bidder and also enable Ford to get a good price. While Ford has never publicly discussed the deal, analysts have estimated the valuation of the two entities at $1.9 billion.

Read more in The Economic Times article.

Tatas may be sole bidder for Jaguar, LR

Tata Motors is inching closer to acquiring Jaguar and Land Rover. Sources in the know told DNA Money that the Tatas are the only serious bidder for the Jaguar-Land Rover (JRM) marquee now.According to them, Mahindra & Mahindra is yet to put in a formal bid for the two brands.

Tata Motors is on a good wicket, because the other strong contenders, namely the who’s who of global private-equity firms, named as possible bidders, may also not pass muster.Ford Motor Company, it seems, is keen on selling the two brands to dedicated car companies only.

The Tatas have appointed Morgan Stanley as their merchant banker for the transaction and they may be ready to pay between $1.5-2 billion.

Read more in The DNA Money article.

Tata Motors may bid for Ford's Jaguar, Land Rover

Tata Motors, India's biggest automobile company, is understood to be in early stages of evaluating a bid for acquiring the Jaguar and Land Rover marques from Ford Motor, British media reports said.

Tata Motors is understood to have instructed advisers in the past fortnight to begin evaluating the merits of a joint offer for Jaguar and Land Rover, which have been earmarked for disposal by struggling American car giant Ford, 'The Daily Telegraph' said.

If successful, it would rank among India's biggest overseas takeover deals, the report said, citing unidentified sources.The report also said Tata Motors is understood to have signed a confidentiality agreement with Ford in recent days.

Besides Tata, other car makers may be interested in bidding, while a formal auction would also be likely to attract private equity firms, it added.

Read more in The Economic Times article.

Nelcast lists at 15% premium to issue price

Nelcast Ltd. listed at Rs 252 at a 15% premium on the NSE against issue price of Rs 219 per share. At 10:21 AM, the scrip was at Rs 221.40, up Rs 2.40 or 1.10% on the NSE with volume of 16,97,197 shares. So far, it rose to a high of Rs 274 and low of Rs 215.

The company has raised Rs 95.26 crore from its public issue of 43.50-lakh shares of face value Rs 10 each. The IPO, which was open from June 4-8, was subscribed 7.36 times.

Nelcast caters mainly to commercial vehicle and tractor industries. It plans to use the issue proceeds for expansion and modernisation of its iron casting units at Gudur in Andhra Pradesh and Ponneri in Tamil Nadu, to reach a production capacity of 1,50,000 MT per annum by 2008-09.

The company’s customer base includes Tata Motors, Ashok Leyland, Eicher Motors, Tata Cummins, Mahindra and Mahindra, TAFE, International Tractors and New Holland India. It exports to the US, Europe and Australia, its client list comprising Arvin Meritor, Volvo, SIGMA and Dobbie Dico Meter.

Tata Motors to raise $ 450 mn from intl mkt

Tata Motors on Wednesday said it will raise 450 million dollars (Rs 1,832 crore) from the international market to meet product development expenditure and fund other corporate projects.

The committee of directors, at its meeting today gave in principle approval, for raising of additional long term resources of 450 million dollars, excluding green shoe option, by issue of appropriate securities in the international markets, Tata Motors told the Bombay Stock Exchange.

Tata Motors recently launched a mass transport passenger vehicle - Magic, developed on the platform of its popular mini truck Ace and a higher capacity van - Winger.
The company plans to roll out more variants in the commercial passenger vehicle segment and plans to invest Rs 5,000-6,000 crore over the next three years in the segment.
Shares of Tata Motors closed at Rs 686.90, up 3.53 per cent on the BSE.

Tatas form finance co for bigger spread

Five years after the Tata group merged its finance unit Tata Finance with Tata Motors, the wheel has turned a full circle for the conglomerate. On Tuesday, Tata Sons, the group’s holding company, said it has formed a new firm, Tata Capital, for financial services that will operate in the large growing segments within the finance sector that also include businesses that Tata Finance earlier operated in.

It has also been learnt that segments of Tata Finance that are now operating within Tata Motors, such as asset and vehicle financing, would be spun off into Tata Capital.

Apart from private equity, which has become a buzzword in India due to recent large deals, Tata Capital would also function in capital market services, merchant banking, housing finance, assets and vehicle financing and retail finance.

Read more in The Economic Times article.

Construction, banking top FII buy list

Foreign institutional investors (FII) have raised their holding in 540 companies out of top 1,000 companies on the Bombay Stock Exchange (BSE) during September-March (2006-07) period. They have trimmed their holdings in 360 companies, while the remainder have seen no change in foreign holding. Among the top 500 companies, FIIs have reduced their stake in 178 companies.

There is no clear sectoral trend, companies that have gained favour with foreign investors are mostly from construction and banking. Second-line IT companies too were on the FII buy list during the half year under consideration. That view may have changed following the recent appreciation in the rupee, which is likely to hurt the margins of most IT companies, brokers say. Most pharmaceutical companies saw a decline in FII shareholding.

Among the top hundred stocks that saw major decrease in FII holding are Punj Lloyd (5.51 per cent), Indian Petrochemicals (5.33 per cent), Bharat Forge (4.59 per cent), Tata Steel (4.1 per cent), Tata Motors (3.8 per cent), I-flex (3.6 per cent), Ambuja Cements (3.6 per cent), Infosys (3.6 per cent) and Siemens (3.6 per cent). However, United Spirits (19.6 per cent), Jai Prakash Associates (6.3 per cent), BF Utilities (7.6 per cent), Glenmark (5.2 per cent) and Grasim (3.6 per cent) saw an increase.

Read more in The Economic Times article.

Mahindra, Renault, Nissan to pay JV fee, share Chennai unit equally

The yet-unnamed joint venture of Mahindra and Mahindra Ltd, its subsidiary Mahindra-Renault Pvt. Ltd, and Nissan Motor Co. that will make four lakh vehicles a year from 2009, will be a contract manufacturer with the three companies equally sharing the capacity, said Pawan Goenka, president (automotive), Mahindra and Mahindra. He added the company was in talks with Nissan to market its cars in India similar to the venture it has with Renault for the Logan sedan.

The joint venture company would not develop or sell cars on its own, said Goenka. The three companies, which would market the products made by the venture, will pay a fee to it in proportion to the goods manufactured.

“Mahindra’s greatest advantage is to get access to the technology of Nissan and Renault through this plant in Chennai,” said Umesh Karne, senior research analyst with Emkay Share and Stock Brokers Ltd. “The joint venture company will be developing cost-advantageous products. So, royalty (fee for manufacturing) would not be an issue.”

Global players such as Fiat SpA and Nissan Motor Co. are entering into contract manufacturing alliances with Indian companies to gain from the low cost of manufacturing in the country and benefit from economies of scale.

Nissan Motor Co. has a tie-up with Maruti Udyog Ltd, which sells one of every two cars sold in the country, to make 50,000 units a year of a small car, which it will export to Europe. Fiat SpA and Tata Motors Ltd are spending Rs4,000 crore to build a factory in Pune which will roll out models designed by the two companies.

Mahindra and Mahindra will hold a 50% equity in the contract manufacturing unit; the chairman and CEO will also be its appointees. Nissan and Renault will work out how to split the other half between themselves.

Read more in The Livemint article

Bulls reign to push Nifty above 4200

Heavy buying interest in frontline stocks propelled key indices to close in the positive. Banking stocks continued to lead the advances followed by cement stocks. Bajaj Auto plunged 9% on the demerger news and disappointing Q4 results. Tata Steel's impressive performance in the March quarter pushed the stock up 1.5%.

The BSE Sensex closed 172 points or 1.22% up at 14,299. The NSE Nifty was up 39 points or 0.92% at 4219. BSE Midcap Index was up 0.65% at 6,080 while the Smallcap Index slipped 0.01% to close at 7205.

Of a total of 2,676 shares traded on the BSE today, 1,241advanced, 1,355 declined and 80 were unchanged.

State Bank of India, up 3.47% at Rs 1,329, Reliance Industries, up 3.15% at Rs 1,685, Dr Reddy's Laboratories, up 2.21% at Rs 678 and Tata Motors, up 2.05% at Rs 750, were the major gainers on the Sensex.

Banking stocks continued to rally upward with SBI and ICICI Bank in the lead. HDFC (up 0.71%) and HDFC Bank (up 0.23%) gained on account of expectations of the merger of the two entities.