Tata Motors to Acquire Iveco Group’s Commercial Vehicle Business in €3.8 Billion Deal

Key Highlights:

• Tata Motors to acquire Iveco Group’s CV business in an all-cash €3.8 billion deal.
• Iveco’s defence unit will be separated before the deal closes, expected by Q2 2026.
• The combined entity will generate €22 billion in revenue with over 5.4 lakh vehicle sales annually.
• Iveco will retain its brands, European footprint, and HQ in Turin post-acquisition.
• Tata has committed to no job losses or plant closures for two years after the deal's completion.

In a major move to strengthen its global position, Tata Motors has signed a definitive agreement to acquire the commercial vehicle (CV) business of the Italy-based Iveco Group for €3.8 billion in an all-cash deal. 

How the Deal Works

The acquisition will be carried out through a voluntary tender offer by TML CV Holdings PTE Ltd (or a Dutch-based entity fully owned by Tata Motors). Tata is offering €14.1 per share, excluding any dividend payout from the defence business divestment of Iveco.

The offer includes a premium of 34–41%, after adjusting for the estimated extraordinary dividend (€5.5–6.0/share) from Iveco’s defence business sale, which is valued at €1.7 billion.

Key Conditions and Timeline

The deal depends on the completion of Iveco’s defence business separation by 31 March 2026. Once this is done, the public offer is expected to close in the second quarter of 2026, subject to regulatory approvals. These include:

• Merger control clearance
• Foreign investment approvals
• EU Foreign Subsidies Regulation clearance

Board and Shareholder Support

Iveco’s Board of Directors has unanimously recommended the offer, saying it is in the best interests of shareholders and stakeholders. Exor N.V., the largest shareholder with 27.06% of shares and 43.11% of voting rights, has given its full support and will tender its entire stake.

What Happens After the Deal?

Once completed, Iveco Group will be delisted from the Euronext Milan stock exchange and become a wholly owned subsidiary of Tata Motors. However, Iveco will keep its:

• Headquarters in Turin, Italy
• Well-known brands
• Manufacturing presence across Europe

This helps maintain Iveco’s identity while enabling strong integration.

Building a €22 Billion CV Giant

Combining the Tata Motors CV business and Iveco Group will create a €22 billion revenue company (approx. ₹2.2 lakh crore), with annual vehicle sales crossing 540,000 units.

The revenue split will be:

• 50% from Europe
• 35% from India
• 15% from the Americas, with added strength in Asia and Africa

Tata Motors Chairman Natarajan Chandrasekaran said, “This is a logical next step following the CV business demerger. It gives us dual home markets, India and Europe, to compete globally.”

Strategic Synergy and Vision

The companies are a good strategic fit, with little overlap in product lines. Key benefits include:

• Tata’s strong position in India and Asia
  
• Iveco’s powertrain expertise through FPT Industrial
• Joint strength in zero-emission mobility, innovation, and R&D

Tata’s Executive Director Girish Wagh added, “We’re unlocking operational excellence and future-ready innovation.” Iveco CEO Olof Persson said, “Joining forces will fast-track zero-emission transport and help us serve more customers worldwide.”

Employee Protections and Long-Term Stability

To ensure stability, Tata Motors has agreed to several non-financial commitments for two years after the deal closure. These include:

• No job losses or plant closures caused directly by the acquisition
• Protection of employee rights
• Brand and operational continuity

These safeguards aim to ensure a smooth integration while protecting the legacy and strength of both companies.

Financing and Advisors

The entire transaction will be funded through financial commitments from Morgan Stanley and MUFG. Key advisors involved include:

• Goldman Sachs (Iveco Group)
• Morgan Stanley (Tata Motors)
• Clifford Chance and other legal and strategic firms

Also Read: Tata Motors in Talks to Buy Italy’s Iveco, Agnelli Family Exploring Options

CMV360 Says

This is one of the biggest international acquisitions by Tata Motors and is likely to reshape the global commercial vehicle industry. By combining strengths across geographies, technologies, and customer segments, the new entity aims to lead the shift toward cleaner, more efficient mobility solutions on a worldwide scale.