Tata Motors in talks to acquire this European truck maker
What's the story
Tata Motors, one of India's leading automotive manufacturers, is in talks with Italy's Agnelli family for a potential acquisition of truck maker Iveco Group, according to Reuters. The discussions are being held with Exor, the investment firm owned by the Agnelli family. Exor owns a 27.1% stake and has 43.1% voting rights in Iveco. The proposed deal would not include Iveco's defense unit, IDV.
Business strategy
Interest in acquiring controlling stake in Iveco
Iveco has been planning to separate its defense business by the end of 2025 or sell it. The company has already received offers from potential buyers. As Exor continues with this separation process, it has reportedly started talks with several non-European counterparts for a possible sale. Meanwhile, Tata Motors has shown interest in acquiring a controlling stake in Iveco Group.
Market dynamics
Smallest among Europe's leading truck makers
Iveco, which also manufactures buses and engines, has a market cap of around €4.2 billion. It is the smallest among Europe's leading truck makers in a market dominated by Volvo, Daimler, and Traton. Despite being seen as a potential M&A candidate by investors and analysts due to its size, its involvement in the sensitive defense business has complicated possible deals and limited potential buyers.
Acquisition history
Offers for Iveco's defense business
In 2021, the Italian government blocked an offer for Iveco from Chinese rival FAW. At that time, Iveco was part of the Agnelli-controlled industrial conglomerate CNH. It was spun off and separately listed at the beginning of 2022. Since then, Iveco has received three offers for its defense business: one from Italian defense company Leonardo and Germany's Rheinmetall; another from Franco-German tank maker KNDS; and a third one from arms company Czechoslovak Group (CSG).