Tata Motors is set to purchase Italian commercial vehicle manufacturer Iveco Group for 3.8 billion euros (over Rs 38,098 crore). Following the 9.23 billion-euro Corus deal in 2007, Iveco is Tata Group’s second-largest acquisition and the biggest one to date for Tata Motors.

1. Tata to pay 14.1 euros per Iveco share, totalling 3.8 billion euros
2. Iveco will sell off its defence division as a requisite for the Tata deal
3. Tata-Iveco is expected to bring in annual revenues of 22 billion euros (Rs 2.2 lakh crore)

Tata Iveco acquisition details

Tata paying 34-41 percent premium for each Iveco share

Tata will offer 14.1 euros per share (cum dividend), adjusted to exclude an expected 5.5-6 euros per share dividend from the divestment of Iveco’s defence business. It represents a 34-41 percent premium over the adjusted share price.

Iveco to shed defence business by end of FY2026

Iveco will sell its defence division for 1.7 billion euros to Italian aerospace company Leonardo S.p.A. before March 31, 2026 – a key condition for the Tata buyout to go through. The deal will also require regulatory approvals under EU merger laws, foreign investment rules and Italy’s Golden Power policy. The Golden Power policy allows the Italian government to oversee and potentially block or impose conditions on direct investments from foreign companies in sectors pertaining to national interest, such as defence, energy and transportation, among others.

The deal will be executed through a voluntary tender offer for all common shares of Iveco Group, excluding its defence business. The offer will be made via a Dutch-based special-purpose entity fully owned by Tata Motors. The Tata deal has received unanimous approval from the Iveco board. Iveco’s majority shareholder, Exor N.V., which controls 27.1 percent of equity and 43.1 percent voting rights, has agreed to tender its shares.

Iveco and Tata to form strong commercial vehicle business

Once the acquisition is completed, Iveco will be delisted from the Italian stock exchange Euronext Milan and become a wholly owned subsidiary of Tata Motors. The commercial vehicle maker will retain its headquarters in Turin, along with its brands and manufacturing operations across Europe.

Combined sales of 5,40,000 units

The combined Tata-Iveco entity will have annual revenues of 22 billion euros (approximately Rs 2.2 lakh crore) and sales of over 5,40,000 units. Their revenue split is projected to be 50 percent from Europe, 35 percent from India and 15 percent from the Americas.

WITH INPUTS FROM KETAN THAKKAR