Tata is top bidder for Jaguar

0 Comments | Deseret News (Salt Lake City), Jan 4, 2008 | by Tom Krisher Associated Press

DETROIT -- An Indian carmaker that will unveil the world's cheapest car next week may soon produce two of the world's premier brands as well.

Ford Motor Co. named Tata Motors Ltd. the top bidder for its Jaguar and Land Rover brands Thursday and entered into "focused negotiations at a more detailed level," meaning Tata was named preferred bidder for the storied British automakers.

"While no final decision has been made, we will proceed with further substantive discussions with Tata Motors over the forthcoming weeks," Lewis Booth, executive vice president of Ford's European units, said in a statement.

Jaguar and Land Rover employees in the United Kingdom were told about the negotiations Thursday morning shortly before the company made the announcement.

Ford executives have said they expect to sell the two British automakers early this year.

Ford spokesman Jay Ward in London would not say how much Tata bid for the automakers, nor would he say if two other bidders, Indian automaker Mahindra & Mahindra Ltd. and U.S. private equity firm One Equity Partners LLC, still were in the running. Last month, people close to the negotiations with Ford told the AP that potential suitors had submitted bids for both companies that ranged from $1.5 billion to $2 billion.

A person briefed on the negotiations said Thursday that Mahindra and One Equity still were under consideration, although Tata is the likely buyer.

"Ford hasn't told them to go away, and that's the end of it," the person told The Associated Press. "Tata's emerged as the preferred partner."

The person requested anonymity because the talks are confidential.

Mumbai-based Tata Motors confirmed the negotiations Thursday.

"We are now entering a period of more focused and detailed negotiations with Ford. We hope both parties can reach an agreement in the forthcoming weeks, though these are complex discussions, and there is still much work that needs to be done before that position is reached," a company statement said. "We are pleased by the progress in the discussions to date and very positive about the prospects of this business going forward."

Tata plans to unveil its ultra-cheap $2,500 car next week at an auto show in New Delhi.

Company Chairman Ratan Tata said in a recent interview that acquiring Jaguar and Land Rover would help bring global visibility to his group -- a sprawling conglomerate that makes everything from automobiles to steel and software, and a name that until recently was little-known outside India.

Ford bought Jaguar for $2.5 billion in 1989 and Land Rover for $2.7 billion in 2000, joining them with Aston Martin and Volvo to form its Premier Automotive Group. Earlier this year Ford completed the sale of its controlling stake in Aston Martin for $931 million in cash and preferred stock.

Ford has said it plans to keep Volvo for now, fixing its cost structure and making it a more premium brand.