Mergers, Acquisitions and Takeovers Case Study

Jaguar and Land Rover Acquisition: Will the Deal Improve Tata Motors Balance Sheet?

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Abstract:
Ford Motors Limited (Ford), one of the world’s leading automobile manufacturers had put its luxury brands Jaguar and Land Rover, on the block. Tata Group company’s automotive major Tata Motors Limited (TML) was one of the top bidders. In March 2008, TML won the bid for $2.3 billion. As per the deal, Ford committed to provide Jaguar and Land Rover with vehicle components and access to engineering and technological support to TML. Apart from funding aspects of the acquisition, analysts wondered how TML would manage these luxury brands as it was a well-known player in low to mid-end segments. The deal pushed TML in the segment where it had less experience. The case helps in discussing financial implications of the deal on the balance sheet of TML and opportunities and challenges for it, post acquisition.

Pedagogical Objectives:

• Offshore expansion through acquisition
• Financial impact on balance sheet of TML
• Post acquisition opportunities and challenges for TML after JLR deal.

Keywords : Tata Motors Limited; Jaguar; Land Rover; Ford Motors, Mergers and Acquisitions; Product-line Synergies; Competitive Scenario; Luxury Car Segment; Indian Car Market; Financial Statement Analysis; Ratio Analysis; Tata Group; India’s Affluent Middle Class; Auto Affordability in India; Mergers,Acquisitions,Alliances Case Study; Financial Performance of Tata Motors

Contents : 
Tata Motors Limited
TML vs Industry: Segment wise Performance
Global Move: Acquisition of Land Rover and Jaguar
Ford: Declining Performance
Future Financial Implications
JLR: Combined Repute for TML
Major Developments
TML: Sources of Revenue and its Distribution 2006-2007
Jaguar and Land Rover: Timeline
Jaguar & Land Rover: Performance
JLR: Combined Financial Performance