- Tata Motors is set to acquire Iveco Group in a €3.8 billion deal, creating a global commercial vehicle powerhouse with production capabilities of over 540,000 vehicles annually.
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Check Offers The deal, estimated at approximately €3.8 billion (excluding Iveco’s defence unit), aims to bring together the best of both companies. The result would be a business capable of producing over 540,000 vehicles annually, with a strong foothold across Europe, India, and the Americas.
A Strategic Fit with Global Ambitions
What makes this acquisition stand out is the complementary nature of the two companies’ product portfolios and geographies. With minimal overlap, the combined firm is expected to enjoy better operating efficiencies and tap into a broader customer base. About half of the combined revenue will come from Europe, 35% from India, and the rest primarily from the Americas, with additional opportunities in Asia and Africa.
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Tata Motors plans to carry out the acquisition through a newly formed Dutch company, wholly owned by the Indian automaker. The offer is contingent on the separation of Iveco’s defence operations, which are expected to be sold or spun off by March 2026. Shareholders of Iveco will be offered €14.1 per share in cash, with an additional dividend between €5.5 and €6.0 per share expected from the defence business sale.
Backing from Stakeholders
Iveco’s board has unanimously endorsed the offer, citing alignment with the company’s long-term goals. Its largest shareholder, Exor N.V., which holds about 27% of Iveco’s common shares and over 43% of voting rights, has already committed to support the deal. The deal also has financing firmly in place, with banks like Morgan Stanley and MUFG Bank underwriting the required funding.
Preserving Identity and Employment
Tata Motors has committed to maintaining Iveco’s corporate identity, headquarters in Turin, and key operational sites. The companies have agreed to a two-year period of non-financial covenants to safeguard employees’ rights and prevent plant closures. No immediate job cuts are anticipated as a result of the merger.
The acquisition will also allow both companies to accelerate their shift towards sustainable mobility and low-emission technologies. Iveco’s powertrain arm, FPT, is expected to play a vital role in expanding the technological edge of the new entity.
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Looking Ahead
If all regulatory hurdles are cleared, and the defence unit is successfully separated, the acquisition is projected to close in the first half of 2026. A general meeting will be convened to secure shareholder approval during the offer period.
This combination represents a major step forward for both Tata Motors and Iveco, providing the scale and diversity needed to thrive in a rapidly evolving industry landscape.
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First Published Date: 31 Jul 2025, 09:16 am IST
