Tata, Mahindra fight US car-makers for Jaguar

MAD RACE: Tata Motors, Mahindra & Mahindra are competing with international players to buy Land Rover and Jaguar.

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Mumbai: There’s more happening in the race to buy Jaguar and Land Rover—the well-known brands earmarked for disposal by struggling American car giant Ford. Both the brands are attracting bids from the biggest international players including from Tata Motors and Mahindra & Mahindra of India.

If either of the Indian conglomerates manages to acquire these two brands, it would surely count as India's biggest overseas takeover deals till date. However, there is fierce competition that may turn Indian acquisition dreams sour. American private equity firm, TPG is eyeing the car brands and is in fact a strong contender for the bid.

TPG’s interest would be more in SUV maker Land Rover, because these are utility vehicle makers that want to expand capabilities in that space. A Land Rover could do wonders for them. But for private equity firms too, it could be the same attraction. Sample this.

During the first six months the sexy however loss-making Jaguar sold 21 percent less than it did a year earlier while Land Rover's sales were up 8 percent, making it reportedly the best first half performance in its history. Its sales in West Asia, a key market for SUVs, have grown 18 percent in those 6 months.

Besides, Land Rover already has a distributor in India, with sales of 150 units a year. But the picture of bidders could get clearer on the July 26, when Ford is expected to take the bidding process, to the next level of due diligence, after announcing its 2nd quarter results.