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Tata drives away with JLR for $2.3 bn
To fund deal through cash reserves, new debt
Steel rates in Punjab dip by Rs 1,300-2,000
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CII delegation meets British PM
A CII delegation with British PM Gordon Brown
Motorola to split into 2 Cos
Raghu Menon to be new Air India CMD
Govt in a fix over Reliance petrol pump closure
Shabana, Javed to open art show
IDBI cuts BPLR to 12.75 pc
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Tata drives away with JLR for $2.3 bn
Mumbai, March 26 Apart from the sale at a sharp discount to its original purchase price, Ford will also be shelling out $ 600 million towards the pension plan for the employees of Jaguar and Land Rover. Even after the two brands are sold to the Tatas, Ford will supply power trains, stamping and other components to the vehicles made under the two marquee labels. It will also provide engineering support, including research and development (R&D), the joint statement said. As per the deal, Ford Motor Credit, an associate company of Ford Motor, will continue to provide financing to JLR dealers for 12 months. There will be no change in the terms of employment for JLR employees. The deal broadly comprises of brand, manufacturing plants and IPR, Ford said. Tata Motors will take control of JLR and Land Rover by the end of the next quarter. In his statement, Ratan Tata, Chairman, Tata Motors, said that he is very pleased with JLR being a significant part of the auto business. He promised that Tata Motors would keep the identities of Jaguar and Land Rover intact. “We are very pleased at the prospect of Jaguar and Land Rover being a significant part of our automotive business. We have enormous respect for the two brands and will endeavour to preserve and keep their identities intact,” Tata said. Both Tata Motors and Ford had earlier decided on taking on board Unite, the trade union of JLR and Land Rover. Tony Woodley, joint general secretary of Unite welcomed the deal. “We would have much preferred Ford to keep the companies in the family....but with the commitments Tata have given to the future of Jaguar Land Rover and the long term supply agreements for components, especially engines from Bridgend and Dagenham, we’re obviously pleased they are in the game,” Woodley told mediapersons. The Tatas had expressed interest in taking over Jaguar Land Rover way back in July last year shortly after Ford put the two brands on the block. In January this year, Ford announced that Tata was the preferred bidder and the finer points of the deal were sewn by Tata and Ford officials in the past few weeks. The transaction is the culmination of Ford’s decision last August to explore strategic options for the JLR business as the company accelerates its focus on its Ford brand and “One Ford” global transformation. “The sale is expected to close by the end of the next quarter and is subject to customary closing conditions, including receipt of applicable regulatory approvals,” the statement said Ford Motor CEO and president Alan Mulally said: “Jaguar and Land Rover are terrific brands. We are confident that they are leaving our fold with the products, plan and team to continue to thrive under Tata’s stewardship. |
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To fund deal through cash reserves, new debt Tata Motors today said the 2.30 billion dollar deal to acquire premium auto brands Jaguar and Land Rover would be funded through a mix of existing cash reserves and new debts. “We will fund the deal through existing cash reserves and new debt facilities which will be raised at the company’s level,” Tata Motors spokesperson said. He, however, declined to comment on the quantum of debt to be raised from the market to part finance the $ 2.30 billion requirement. Recently, Tata Motors had announced that its Board has approved raising of Rs 4,000 crore (about $ 1 billion) from either overseas or domestic markets through issuance of securities. From 1 lakh to 1 crore, Tata makes them all
Tata Motors today became the world’s only vehicle maker that offers a choice of cars ranging from Rs 1 lakh (Nano) to over Rs 1 crore following the acquisition of Ford’s luxury car brand Jaguar, along with Land Rover. The Jaguar marque sells worldwide for the equivalent of anything between Rs 50 lakh and above and could cost up to Rs 1 crore when imported to India and would drive its new owner into the select club of luxury car makers like BMW and Audi. Two months ago, Tata Motors earned the distinction of becoming the world’s cheapest carmaker when it unveiled Nano that will begin selling for Rs 1 lakh later this year. Critics grounded
For years, critics termed Tata’s vehicle business as a millstone around the neck. But Group Chairman Ratan Tata today flattened their theory by taking the automobile venture to a new plane with the acquisition of British luxury brands Jaguar and Land Rover. Adrenaline pumping buyouts such as JLR are increasingly becoming a habit with Tata, 70, who last year essayed the largest overseas takeover by an Indian company-Tata Steel’s acquisition of Anglo-Dutch steel maker Corus for $ 12.1 billion. “We did everything in small increments so we always lagged behind,” Tata said in a comment posted on the Tata group’s website earlier. The Corus buy was special for Tata as it happened in the centenary year of Tata Steel and now the acquisition of JLR will help firmly establish Tatas in the global corporate map as a name to reckon with. Govt praise for deal
The government today showered rich compliments on the Tata Group for acquiring Jaguar and Land Rover marque car brands and holding India’s flag high in the highly competitive international business. “My congratulations to the Tatas and entire corporate world as they have held India’s private sector flag high. The world is looking at India,” Commerce and Industry Minister Kamal Nath said here. He said homegrown Indian firms have demonstrated to the global business how competent they are in the midst of a slowdown. While Mahindra and Mahindra was also in the race, the keenly-watched contest was limited to the Indian companies in its final stage.
— PTI |
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Steel rates in Punjab dip by Rs 1,300-2,000
Chandigarh, March 26 The Punjab traders said that the rates are expected to fall down further by another 1,000-1,500 per MT within a couple of days. “The prices have softened because of the announcement by the Indian Steel Alliance that the steel producers would immediately stop steel export,” said a Mandi Gobindgarh-based steel trader. However, the slight relief emerged in the shape of softening of steel prices could not accrue to steel consumers like light engineering industry of the state as induction furnaces have temporarily stopped booking orders from the industry due to reduction in prices. The prices of ingot have come down to Rs 38,500 per MT from Rs 39,800 per MT within a day. Similarly, the rates of Round (Saria) have fallen down to Rs 43,000 per MT from Rs 45,000 per MT. Although the steel prices have softened in the state, the light engineering industry has accused the state-based induction furnaces (secondary steel producers) of not passing on the benefit to them by creating false propaganda that there was no demand for steel in the state. “We are not getting any benefit out of reduction in steel prices as the induction furnaces are not booking orders at reduced prices even as the demand for steel is there,” Engineering Export Promotion Council Regional Chairman S C Ralhan said today. Punjab, being a major producer of steel, has almost 200 induction furnaces and four arc furnaces spread across Mandi Gobindgarh, Ludhiana and Khanna. Meanwhile, North India Induction Furnace Association President K K Garg said that the orders were not being booked as there was no clarity on the stance of Union Government on steel issue.
— PTI |
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CII delegation meets British PM
Chandigarh, March 26 The CII delegation had called on the British Prime Minister as a follow-up to his visit to India in January 2008, accompanied by some of Britain’s leading CEOs. Brown spoke about some of his key decisions that would shape the long-term stability and growth of the economy. This included issues about energy, planning processes, infrastructure, science and innovation, skills and climate change. Discussions revolved around opportunities for greater partnership and collaboration as well as issues of trade and investment. The CII delegation proposed a partnership with the UK for developing a Mission on Skills for imparting skills to one million Indians who would then form part of the global talent pool.
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New York, March 26 The move, which comes amid an intensifying proxy battle against activist investor Carl Icahn ahead of a May 5 annual meeting, could be a prelude for a joint venture for the cell phone business, analysts said. They said separating the cell phone business, which has been losing market share to rivals like Nokia and Samsung Electronics, could help Motorola find a strategic investor, such as among Asian handset makers that are keen to win a bigger share of the U.S. market. Under pressure from its second-largest investor Icahn to boost shareholder returns, Motorola announced a strategic review in late January but no potential buyers have emerged. “I suspect it’s a prelude for a joint venture for the mobile devices business,” said Avian Securities analyst Tero Kuittinen, who sees Chinese and Japanese companies as the top candidates for a venture. “It might be easier to negotiate with a standalone unit,” Kuittinen said. “It’s positive news because it shows the company is moving toward a serious restructuring.” Motorola, now ranked third in the global handset market, said the split would take the form of a tax-free distribution to its shareholders and expected it to be completed in 2009. The company has already started to look for a new head for its mobile devices business. “We expect this action to enhance recovery in mobile devices and accelerate efforts to attract a new leader,” Chief Executive Greg Brown said on a conference call with analysts. Motorola plans to separate its Mobile Devices unit from its Broadband & Mobility Solutions business. The latter consists of its network equipment, enterprise and public safety businesses. Brown did not give details on the branding strategy for each business, beyond saying the Motorola brand is important for the mobile devices business. Shares of Motorola, which has a market value of about $22 billion, have fallen more than 60 per cent since October 2006, amid handset market share losses and criticism for failing to come up with a strong successor to the once-lauded Razr phone. Motorola is engaged in a proxy battle with Icahn, who owns a 6.3 percent stake. He has proposed a slate of four directors to the board and is suing Motorola to force it to hand over documents related to its mobile devices business. Icahn was not immediately available for comment today. He told Reuters in an interview on Monday that he would not be satisfied unless Keith Meister, chief executive of Icahn Enterprises and manager of Icahn’s $8 billion fund, became a director of Motorola. Motorola said today there was no assurance the planned split, which is subject to further financial, tax and legal analysis, would occur. — Reuters
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Maruti on DZire drive
New Delhi, March 26 It will replace MSIL’s old war-horse Esteem, which was phased out six months ago. The car will be available in the Capital between Rs 4.49 lakh to Rs. 6.70 lakh (ex-showroom) in three variants each, in petrol and diesel versions. The petrol variants would be available at prices between Rs 4.49 lakh and Rs 5.90 lakh while the diesel versions would be available between the price band of Rs 5.39 lakh and Rs 6.70 lakh. MSIL managing director S. Nakanishi said, “The DZire is the seventh model Maruti Suzuki has launched in three years. It has a special place in our product strategy. Millions of Indians own compact cars. With growing incomes and better lifestyle, many of them want to upgrade to a sedan.” He said many would be able to shift to a sedan because of the price at which the Swift DZire would be available. He was, however, confident that the price strategy for Swift Dzire would not result in cannibalisation of SX 4 market. “The cars belong to different markets. Cannibalisation would be minimal,” he stated. The launch of Swift DZire is also sure to create ripples in the entry-level sedan segment of the car market. This segment, which has models like Indigo, Logan and Ikon draws most of its sales from the diesel segment. For Maruti, the launch of DZire is also crucial as the company is trying to expand its image from being a small car leader to one offering the full range of models. The company is counting on the DZire to help consolidate its leadership position in this segment. While offering the DZire in diesel as well as petrol, Maruti has loaded the car with features like integrated stereo, automatic climate control, audio steering control and dual airbags, anti-brake locking system, engine immobiliser and alloy wheels in the high-end models. Although the Logan starts at Rs 3.89 lakh, the highest selling variant is the 1.5 DLX priced close to Rs 6 lakh. Similarly, the Indigo Dicor LS and Dicor LX, priced at Rs 5.29 and Rs 5.89 lakh respectively, constitute the bulk of sales. DZire is being launched at a time when the company has managed to race past competition in the mid-sized sedan segment (A3) selling nearly 41,000 units in the April-February period of this fiscal. While continuing to lead India’s small car market, Maruti Suzuki has emerged as the market leader in the A3 segment as well during 2007-08.
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Raghu Menon to be new Air India CMD
New Delhi, March 26 He would replace V. Thulasidas, who retires on March 31.
Although the official notification from the government, following the clearance of the appointment from the Appointment’s Committee of the Cabinet (ACC), was still to come, but top level sources in the Ministry of Civil Aviation confirmed that Menon had been appointed as the new CMD of Air India. The appointment of Menon also comes as a surprise as not only were the credentials of the present Joint MD of Air India Vishwapati Trivedi ignored, but the government also appointed an officer of the Special Secretary level at the post which essentially is for an officer of a rank below at Additional Secretary level. Further, reports suggested that Menon, after initially applying for the post had withdrawn after being promoted as a Special Secretary. The withdrawal of the application also apparently came at the suggestion of the Cabinet Secretariat.
The process for selecting the new CMD for Air India (NACIL) had started more than two months ago with a total of 51 applications being received initially. The candidates were from various fields including those from the IAS, IPS, Air India, armed forces and those sponsored by the Ministry of Civil Aviation. Incidentally, the ministry had sponsored the applications of both Menon and Trivedi. |
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Govt in a fix over Reliance petrol pump closure
New Delhi, March 26 “You don’t expect the government to give subsidy to (private retailers like) Reliance and Essar (Oil). But you also cannot expect them to be penalised,” he told reporters here. Reliance plans to shut two-third of its 1,400 petrol pumps in the country by next month, as it is unable to match the fuel price offered by state-run retailers, who get compensated by the government for selling fuel below the cost. Deora said no one had approached him demanding subsidy. Reliance and Essar make huge losses on selling petrol and diesel at prices higher than Indian Oil, Bharat Petroleum and Hindustan Petroleum. Public sector retailers, too, lose Rs 10.93 on sale of every litre of petrol and Rs 14.66 per litre on diesel but the losses are made up by issue of oil bonds by the government and discounts from ONGC, GAIL and Oil India.
— PTI |
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Shabana, Javed to open art show
Chandigarh, March 26 This year’s show will feature more than 350 works of art by 173 artists, and will be open to the public from March 29 to April 6. The show will recognise two emerging artists for outstanding work, who will be awarded Rs 1 lakh each. The jury panel for the show will be chaired by Tina Ambani. |
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IDBI cuts BPLR to 12.75 pc
Mumbai, March 26 The BPLR has been revised from the existing 13.25 per cent to 12.75 per cent, IDBI said in a press release issued here.
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GAIL inks MoU China may join IPI project Nortel bags deal from BSNL Corporation Bank dividend Oz firm bags ONGC contract Ctrl S to invest $250 million |
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Tata Motors today announced that it has bought Jaguar and Land Rover for US $ 2.3 billion from the Ford Motor Company. According to analysts the price paid by the Tatas is half the price paid by the Ford Motor Company when it acquired the two brands five years ago.
Chandigarh, March 26
