LONDON: Not wanting to alienate other suitors including Mahindras, Ford may wait till the New Year to announce the winner for its Jaguar and Land Rover brands, although Indian conglomerate Tatas have emerged as the top choice, media reports said here on Friday.
“Tata Motors is set to be chosen by Ford as the preferred bidder for Jaguar and Land Rover as early as Friday,” a report in Financial Times said quoting people close to the situation.
“For all intents and purposes, Tata is the preferred bidder,” the report quoted a person close to one of the rival bidders, who added that Ford might select a preferred bidder without making an official announcement to avoid alienating other suitors, whom it needed to keep on side .
When contacted, a Ford spokesperson told PTI, “no decision has been made at this time... We anticipate an agreement early next year at the latest.”
He added: “These are complex commercial discussions and it is in the interests of all parties concerned if the process is conducted in a confidential manner.”
The Financial Times report said that Tata Motors had pulled ahead of two rival bidders — another Indian carmaker Mahindra and Mahindra and One Equity, a private equity firm led by the former Ford CEO, Jacques Nasser.
“Ford is likely to make an official announcement after the New Year,” Financial Times said, adding offers were in the range of $1.8-2.2 billion.
It added that Tatas would be given an exclusivity period to finalise the detailed agreements and a final deal was expected to be signed early in 2008.
“Ford is expected to take the successful preferred bidder before the Jaguar and Land Rover pension trustees for further negotiations. They would then begin the complicated negotiations required to reach a final arrangement,” the Financial Times report said. The successful bidder would be asked to sign about 40 contracts as part of the deal, it added.
“There could be several more sticking points that could undo a deal, such as the cost of complying with stricter emissions regulations in Europe and whether the successful bidder would be permitted to use intellectual property belonging to Jaguar and Land Rover in other parts of the group,” the report noted. — PTI