Jaguar Land Rover Merger

1398 Words 6 Pages
The merger between Tata and JLR was a mutually beneficial, for whereas Tata was looking for a means to have a global foothold, Ford was looking for prospective buyers to help them cut their losses by buying Jaguar and Land Rover from them. This was the prime reason for Ford to invite tenders for the sale of the same .
There were many reasons for Tata to acquire JLR. Some of them are :
i. As part of a larger strategy to grow in the automotive sector; ii. Opportunity to participate in two fast growing auto segments (premium and small cars), and to build a comprehensive product portfolio with a global footprint; iii. Unique opportunity to move into premium segment with access to world class iconic brands; iv. Sharing of best practices between the three brands, leading to better organizational growth and development; and
v. Long-term benefits from component sourcing, low cost engineering and design services, leading to lowering costs and increasing public outreach
In order to finance the takeover, Tata planned to utilise some of its cash resources and raise further capital from floating equity and taking some market debt. However, financing the deal was not the main issue. The main issue was the growing fear among the people working in the merging companies with regard to possible restructuring and changes in working
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While the deal offered Tata with a golden opportunity to step into the global luxury car market, it also brought along with it a unique set of challenges, which Tata had to not only foresee, but also proactively take up and address before they became a hurdle. To top it off, both Jaguar and Land Rover had been loss-making brands for Ford. Thus, Tata had to develop a plan to re-route the brands so as to make profits. However, it had to do so in a manner that would not be detrimental to the working conditions of the

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