Tata: Leaping ahead with Jaguar

image In a steady shifting of the tide, more and more Asian companies have been buying up American companies in the last couple of years. According to WSJ, Asian acquisition of foreign companies more than doubled to a record $433 billion in 2007. In the same time, image US deals increased by only 14%.

Boosted by the growing economies, and the cheap dollar, US acquisitions are beginning to look decidedly more attractive to far eastern and south Asian companies seeking to establish an international presence.

One deal that is in the works, and is attracting a great deal of attention is the planned acquisition of Ford’s Jaguar and Land Rover units by Tata Motors, a part of the Indian conglomerate, the Tata Group.

image Tata Motors had a great photo-op recently, as Chairman Ratan Tata unveiled the much anticipated "Nano", which at $2500, is the cheapest car in the world. The Nano is aimed at becoming a "starter car" for the Indian market. With this car, Tata has created a niche space without any competitors - for now, anyway.

That selling its money losing Jaguar US operations seems to be a clearly beneficial move for Ford. The bigger speculation seems to be about what Tata’s plans are for the acquisition. Rumors are that they are planning to build a cheap car for the US market, and would, in future, leverage the Jaguar international distribution system.

The Tata group, which started in 1870’s as a textile mill in India, has since grown into a monolith with 98 companies in almost every business sector imaginable, including Iron and Steel, Energy, Consulting services, Engineering and Automotive.

The group has made several acquisitions recently and hit the headlines when it took over the European steel maker Corus group for $9.5 billion, in 2006.


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