Tata Motors tumbles for 2nd day; down 44% from 52-week high amid Iveco buyout

Shares of Tata Motors Ltd extended losses for the second straight session on Thursday, slipping 2.4 per cent amid continued investor anxiety over the company’s proposed acquisition of Iveco Group.

At 9:29 am, Tata Motors stock was down 0.80 per cent at Rs 663.05 on the BSE. The scrip touched an intraday low of Rs 652.05, falling 2.4 per cent from its previous close of Rs 668.40. With this, the stock has plunged nearly 44.5 per cent from its 52-week high of Rs 1,176.30.

This follows Wednesday’s sharp decline, when Tata Motors emerged as the top Sensex loser in early trade after reports that the automaker may acquire Iveco Group’s truck business from the Agnelli family for $4.5 billion.

Tata Motors informed the stock exchanges regarding the same on July 30. In the filing, the company said the offer aims to acquire all 27.12 crore common shares of Iveco listed on Euronext Milan and ultimately delist the company. Tata Motors, through TML CV, intends to pay 14.10 euros per share, excluding any dividend from Iveco’s defence business divestment.

“Tata Motors believes that Tata Motors and Iveco have a significant opportunity for developing a combined group, which allow each of the companies to reach its fullest potential and to compete globally and lead the emerging trends in the industry,” the statement said.

“In case of successful completion of the Offer, Tata Motors and Iveco may benefit from a material portfolio complementarity with very limited geographic overlap, which would foster a smooth and successful integration, whilst preserving each group's industrial footprint and employees' community. Tata Motors remains convinced that this combination presents a compelling opportunity to create substantial and actual value creation for all relevant stakeholders,” Tata Motors said in an exchange filing.

“Tata Motors is deeply aware of the strength of Iveco’s business, brands and its strategic position in Europe. Simultaneously, Tata Motors also recognises various areas of potential synergies which can be tapped by working jointly, leveraging the parties' complementary know-how and assets, and optimising wherever required in order to bring more efficiencies and create an even more effective player in the commercial vehicles industry,” the company said.

Tata Motors said the full details and offer document would be submitted to CONSOB, the Italian regulatory body, for approval following necessary clearances.