Tata Motors Targets $4.5 Billion Acquisition of Iveco Truck Division

Tata Motors, part of the Indian multinational conglomerate Tata Group, is poised to acquire the Italian truck maker Iveco for approximately $4.5 billion (£3.9 billion). This acquisition is anticipated to be Tata Group’s second-largest, following its acquisition of Corus in 2007, and the most significant for its automotive sector. The last major purchase made by Tata Motors was the acquisition of Jaguar Land Rover for $2.3 billion in 2008.

Sources familiar with the negotiations have indicated that both Tata Motors and Iveco, based in Turin, Italy, plan to hold board meetings on Wednesday to formalise the agreement. On Tuesday, Iveco confirmed that it was engaged in “ongoing, advanced” negotiations concerning deals involving its defence operations as well as its broader industrial portfolio.

According to reports, Tata Motors aims to acquire a 27.1% stake from Exor, the investment firm owned by the Agnelli family, which currently possesses 43.1% of the voting rights. Following this initial acquisition, Tata Motors intends to launch a tender offer for shares from other smaller stakeholders. It should be noted that the deal will exclude Iveco's defence division, which the company has expressed intentions to divest by the end of 2025.

On Tuesday, shares of Iveco rose by as much as 7.4% during trading hours, pushing the company’s market valuation to $6.15 billion. This represents a more than twofold increase in value so far this year. The support for the potential acquisition from both Tata Motors and the Agnelli family is rooted in a historically strong partnership. In the past, Tata collaborated with the Agnelli-owned Fiat Motors in India.

Morgan Stanley is acting as the financial adviser for Tata Motors, while Goldman Sachs represents the interests of the Agnelli family and Iveco. Legal counsel for the transaction is being provided by Clifford Chance. According to insiders, discussions have been ongoing for the past six weeks and have intensified recently. An exclusivity agreement for bilateral negotiations is set to expire on August 1.

This acquisition is viewed as an opportunity for Tata Motors to elevate its operations in the commercial vehicle segment, gaining access to enhanced technologies and a larger market presence. While most of Iveco's revenue—approximately 74%—is derived from Europe, the firm also maintains a foothold in North and Latin America.

Following the news regarding the acquisition, Tata Motors' shares dropped nearly 4% on July 30, 2025. The stock traded lower at ₹691.95 on the Bombay Stock Exchange, down from ₹692.40, with an intraday low of ₹665.45 recorded. The current market capitalisation for the firm stands at ₹246,435 crore. Over the past five years, Tata Motors’ shares have increased by 545.81%, although they have experienced a 42.38% correction within the last year.

In a related development, Jaguar Land Rover (JLR), which is owned by Tata Motors, announced plans to reduce hundreds of managerial positions as part of a “limited” voluntary redundancy programme. A spokesperson for JLR affirmed that the objective is to better align its leadership workforce with the business strategy of the luxury car brand.

In summary, the potential acquisition of Iveco represents a strategic move for Tata Motors as the company seeks to strengthen its presence in the international commercial vehicle market while navigating ongoing developments within its business operations.