Tata Motors Shares Dip Over 4%, Iveco Acquisition Talks Spark Investor Concern

Key Highlights:

- Tata Motors in talks to acquire Iveco’s truck division for USD 4.5 billion.

- Shares fell over 4% as investors reacted to the potential mega deal.

- Acquisition could boost Tata’s global commercial vehicle footprint.

Mumbai: Following reports that Tata Motors is in advanced negotiations to purchase the truck division of Italy's Iveco Group in a possible USD 4.5 billion deal, the company's shares experienced significant pressure on Wednesday. They fell by almost 4 per cent in early trading.

Tata Motors' stock was down 3.08 per cent from the previous close at Rs 671.85, as of 11:23 A.M. The drop is a result of investor apprehension about the scope and consequences of what might turn out to be the second-largest foreign acquisition for the Tata Group after its USD 12.9 billion acquisition of Corus Steel in 2007.

The talks with Iveco, which is owned by the Agnelli family, are reportedly centred on purchasing its Defence and commercial truck businesses.

Iveco has admitted to looking into the possibility of selling its industrial vehicle division, but no firm decision has been made as of yet.

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However, it has been reported that the deal may receive Board-level approvals as early as today.

If completed, the deal would be Tata Motors' largest acquisition since its 2008 USD 2.3 billion acquisition of Jaguar Land Rover and could greatly increase the company's presence in the global commercial vehicle market.

The timing is notable, as Tata Motors is spinning off its commercial vehicle business into a separate entity, a process expected to conclude by December 2025.

In India, that division has a 30 per cent market share for light commercial vehicles (LCVs) and a 49 per cent market share for heavy commercial vehicles (HCVs).

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It generated Rs 75,000 crore in revenue in the previous fiscal year.

The foundation of Iveco's industrial operations is its truck business, which generates 70 per cent of total industrial revenue. The company's bus and powertrain divisions each contribute 15 per cent.

Iveco maintained an 8–9 per cent presence in the medium and heavy truck segment and a 13.3 per cent share in the European LCV market in 2024.