Deal to 'improve firm's fortunes'
India's Tata Motors Ltd said yesterday it was confident its $2.3 billion deal to buy Jaguar and Land Rover from Ford should improve its balance sheet in the long term.
"We have gone through the profit and loss and balance sheet. We think we are pretty confident that they will add positively to our consolidated balance sheet," managing director Ravi Kant said on the sidelines of Bangkok's auto show.
"We may have some pressure. That doesn't mean we have to change position because we have a long-term plan," he said without elaborating.
Analysts have expressed concern about how Tata Motors would fund the deal and how it would fit the luxury brands into its stable of trucks, buses and cars, including the Nano, set to be the world's cheapest car at about $2,500 when it goes on sale later this year.
Tata has announced plans to raise $4 billion, expected to help finance the Ford deal and the manufacture of the Nano, which it unveiled in January.
"We are raising bridge loans for the acquisition of Jaguar and Land Rover. This is only for a certain specific period. During this period, we would come to some long-term arrangements, which will consist of loans and some possible equity," Kant said.
"I think in the next six to eight months, the picture will become much clearer," Kant said.
Agencies
(China Daily 03/28/2008 page17)
