Tata Motors to Acquire Iveco’s Commercial Vehicle Business

31 Jul 2025 , 12:51 PM

Tata Motors on Wednesday announced a major overseas acquisition, revealing plans to acquire the commercial vehicle business of Italy-based Iveco Group through an all-cash deal valued at approximately €3.8 billion (around $4.4 billion).

The transaction, which excludes Iveco’s defence unit, will be executed through Tata Motors’ wholly owned subsidiary TML CV Holdings PTE LTD, or potentially via a newly formed Dutch entity.

As part of the agreement, Tata Motors will launch a voluntary tender offer to acquire all issued common shares of Iveco Group at €14.1 per share in cash.

Iveco’s defence division will not be part of the Tata deal. Instead, it will be sold separately to Italian defence group Leonardo, which is backed by the state, as confirmed in a separate announcement on the same day.

Iveco is currently controlled by Italy’s Agnelli family through their holding company Exor. Following the transaction, Tata Motors has agreed to uphold certain non-financial commitments related to employment and operations for at least two years after the deal closes.

Commenting on the deal, Suzanne Heywood, Chair of Iveco Group, described the transaction as a “strategically significant combination”, noting that both companies share a vision for sustainable mobility.

She also said the combination reinforces employment security and industrial presence across Iveco Group’s footprint, addressing potential concerns over job losses or downsizing post-acquisition.

In addition to the €14.1 offer price, shareholders are also expected to receive a special dividend of €5.5–€6.0 per share, stemming from the defence unit’s separate sale.

On a combined basis, the total value offers shareholders a 22%–25% premium over Iveco’s three-month average share price of €16.02 (as of July 17, 2025). Even after adjusting for the dividend payout, the offer represents a 34%–41% premium, making it an attractive deal for Iveco shareholders.

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