Tata Motors, the automobile company that is part of a vast family-owned Indian conglomerate, is clearly interested is taking over the Ford's famous English patients, Jaguar and Land Rover.
Tata chairman Ratan Tata said Jaguar and Land Rover could help expand Tata Motors unit's footprint around the world. It
also could reduce Tata's dependence on the Indian market, which now accounts for more than 90 percent of Tata's automotive sales.
"We certainly have an interest in that,'' Tata told the CNN-IBN television channel in an interview, excerpts of which were broadcast Friday. "It
is to give ourselves scale, to give ourselves global reach,'' Tata said, declining to comment further.
Ford, which lost $12.7 billion in 2006, has been looking to sell its Jaguar and Land Rover units and the deal is now expected to close either late this year or early in 2008, Alan Mulally, Ford's chief executive indicated last week.
At least three private equity groups-Cerberus Capital Management LLC, Ripplewood LLC and One Equity Partners LLC, which is linked to JPMorgan Chase & Co.-also have expressed an interest in the automotive icons. While both brands have enormous appeal, Ford has lavished billions on both but has seen virtually no return on its investment.
Nick Scheele, who served as Ford's president between 2001 and 2005, has reportedly joined New York-based Ripplewood Holdings LLC to bid for the luxury brands.
Jacques Nasser, who was Ford's chief executive from 1999 to 2001, has tied up with One Equity Partners.
The recent upheaval in global financial markets, however, may have given Tata the edge in the upcoming bidding wars for two English brands. Private equity groups are facing difficulties in raising the capital needed to complete deals. Cerberus' bid for Chrysler almost came apart at the last minute because of the turmoil.
Also, the Blackstone Group lost a chance to take over SiemensVDO earlier this month. Blackstone/TRW was prepared to pay more for Continental AG, which walked off with Siemens in a deal valued at more than $15 billion but couldn't arrange the necessary financing at a critical moment, according to one story circulating the automotive business. Thus, Continental won the bidding war for Siemens even though it
bid less than Blackstone/TRW and now has an excellent chance of developing into one of the world's top suppliers of high-tech components to the world's automakers.
The Tata Group doesn't appear to face the same kind of financing challenges. Tata, while it
has excellent ties to India's banking establishment, maintains a broad set of interests in several industries ranging from automobiles to steel and software in India's rapidly expanding automotive market.
Tata Steel also has put up $12 billion to acquire Britain-based Corus Steel. When it
's finished, the acquisition of Corus could make Tata the world's fifth largest steel maker according to some accounts.
Tata officials had previously refused to comment on media speculation about a possible bid for the Ford assets.