Tata Motors makes Its biggest bet yet with Iveco acquisition

Key highlights

• Tata Motors to acquire Italian commercial vehicle giant Iveco Group for €3.8 billion (INR 38,098 crore)
• Iveco’s defence division to be sold to Leonardo S.p.A before March 2026 as part of the deal condition
• Combined entity to generate €22 billion in annual revenue with operations across Europe, India, and the Americas

Tata Motors has announced its largest acquisition to date—a €3.8 billion (INR 38,098 crore) buyout of Iveco Group, the Italian commercial vehicle heavyweight. The deal, approved unanimously by Iveco’s board, will be executed via a voluntary tender offer through a Dutch-based special purpose entity fully owned by Tata Motors.

This marks Tata Group’s second-largest overseas acquisition after the Corus deal in 2007, and it’s a strategic leap toward creating a global commercial vehicle champion. Iveco’s majority shareholder, Exor N.V., which holds 27.1% equity and 43.1% voting rights, has agreed to tender its shares.

Deal structure and strategic conditions

Tata will pay €14.1 per share, adjusted to exclude an expected €5.5–6 dividend from the sale of Iveco’s defence business. That’s a 34–41% premium over the adjusted share price, a bold signal of Tata’s confidence in the deal.

Before the acquisition closes, Iveco will divest its defence division to Leonardo S.p.A for €1.7 billion. This is a key condition, along with regulatory approvals under EU merger laws, foreign investment rules, and Italy’s Golden Power policy, which allows the government to oversee foreign investments in strategic sectors.

Once complete, Iveco will be delisted from Euronext Milan and become a wholly owned subsidiary of Tata Motors. The company will retain its Turin headquarters, brands, and manufacturing footprint across Europe.

What this means for Tata Motors

The combined Tata-Iveco entity will boast:

• Annual revenue of €22 billion (INR 2.2 lakh crore)
• Sales of over 540,000 units globally
• Revenue split: 50% Europe, 35% India, 15% Americas

This acquisition follows Tata’s recent demerger of its commercial vehicle business, positioning the group to compete globally with dual home markets in India and Europe.

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