Ford Motor (F) is about to hand the keys for Jaguar and Land Rover to India-based Tata Motors. The sale is expected to be announced Wednesday, according to a source briefed on the negotiations who did not want to be named because the deal had not yet been made public. Tata is to pay about $2 billion and has agreed to continue to build the vehicles in their British plants. The complicated deal will also cover continued supply of Ford-made components and deal with labor issues. Ford has been working with Tata on details of the sale for several months.
"This represents a first, with an Indian company really stepping outside as an investor with a significant couple of brands," says David Cole, chairman of the Center for Automotive Research. "And it enables Ford to convert what has been a pretty extensive part of the company into some needed cash. This is really a pretty big step." Tata Motors, a maker of light and heavy trucks and family cars, is attempting to broaden its global automotive presence.
For struggling Ford, the move sheds two more European luxury brands that had become a drag on cash. Particularly draining was Jaguar, in which Ford sank nearly $10 billion trying to revive the brand after spending $2.5 billion to buy it in a deal that closed in 1990.
Source : http://www.usatoday.com/
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