Tata Motors Needs Iveco Holdouts to Tender by Monday

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Tata Motors' €3.9 billion bid for Iveco reaches its deadline on Monday, October 26. To get full ownership of the Italian commercial vehicle maker and delist it, the company needs a sharp rise in the number of shareholders who tender.

Tata Motors managing director and CEO Girish Wagh put acceptance at 35%. By October 19, investors had tendered 31.19% of Iveco's shares. The company expects participation to grow as the deadline gets closer.

Where the opposition stands

Full ownership and delisting require acceptance from 80% of Iveco's current shareholders. Petrus Advisers, which holds 3.8%, has opposed the offer and argues that it undervalues the company. Hedge funds Syquant Capital and Davidson Kempner have not yet tendered.

Together, the three investors hold around 20.4% of Iveco's common shares.

Tata Motors raised its offer from €14.10 to €14.40 per share in October and called the new price its best and final offer. Wagh has repeated that it will not go higher.

Reaching 66.67% but not 80% would let Tata Motors go ahead with the shares tendered, subject to the offer terms. Iveco would then stay listed with minority shareholders, which could complicate the planned delisting and restructuring.

What the deal covers

The deal excludes Iveco's defence business. It would bring Tata Motors' commercial vehicle operations together with Iveco's truck and bus businesses in international markets. The combined business is expected to have annual revenue of around €21 billion and to sell more than 590,000 vehicles.

Tata Motors has said the combination could open ways to share engineering, procurement and support capabilities, and to improve purchasing leverage. Consolidation is to begin next quarter, and the first priority is a smooth transition across businesses and markets.

Source: The Financial Express