Tata Motors in talks to buy Italy’s Iveco in $4.5 bn deal

Tata Motors is in advanced talks to acquire the commercial vehicle business of Italy's Iveco Group for a reported $4.5 billion, according to reports. The deal, if finalised, would mark a significant global expansion for the Indian automaker and represent a potential turning point for the European truck maker, currently majority-owned by the Agnelli family's holding company, Exor.

Sources close to the negotiations told Reuters that Tata Motors has formally approached Exor to purchase its stake in Iveco, which includes approximately 27.1% of shares and 43.1% of voting rights. The proposed transaction would exclude Iveco Defence Vehicles (IDV), the group's military division, which is being spun off in a parallel process.

Iveco's commercial trucks and bus operations have a strong presence across Europe and South America.

The news has already stirred market reaction, with Iveco shares jumping nearly 25% in Milan after speculation of the deal surfaced. Industry insiders say the timing is opportune, as Iveco is seeking to streamline its portfolio, while Tata Motors is looking to bolster its international footprint after a strong performance in both its domestic and Jaguar Land Rover divisions.

The exclusion of Iveco's defence unit from the deal is seen as a necessary condition to avoid regulatory pushback. Several European defence companies, including KNDS and Leonardo (in partnership with Germany's Rheinmetall), are reportedly in the fray to acquire the defence division, which is valued separately at nearly €1.9 billion.