Tata Motors to acquire Iveco’s commercial vehicle business for €3.8 billion, excluding defence unit

India’s Tata Motors has agreed to acquire the commercial vehicle business of Italy-based Iveco Group through an all-cash offer valuing the company at approximately €3.8 billion ($4.4 billion), the company announced on Wednesday.

ET had reported of the likely move earlier in the day.

The acquisition, which excludes Iveco’s defence business, will be carried out via Tata Motors’ wholly owned subsidiary, TML CV Holdings PTE LTD, or a newly incorporated Dutch entity. A voluntary tender offer will be launched at €14.1 per share in cash for all issued common shares of Iveco Group, contingent upon the successful separation of its defence operations.


According to the press released shared by the automaker, Iveco’s defence unit will not be part of the Tata Motors transaction. Instead, it will be sold separately to Italy’s state-backed defence firm Leonardo, in a deal also announced Wednesday. Iveco Group is currently controlled by Italy's Agnelli family through investment company Exor.

"We are proud to announce this strategically significant combination, which bringsIvecother two businesses with a shared vision for sustainable mobility. Moreover, the reinforced prospects of the new combiIvecon are strongly positive in terms of the security of employment and industrial footprint of Iveco Group as a whole," said Suzanne Heywood, Chair of Iveco Group.

The deal values Iveco’s remaining commercial vehicle business and offers shareholders a significant premium:

• The €14.1 offer price, along with an estimated special dividend of €5.5–€6.0 per share related to the defence unit sale, amounts to a 22%–25% premium over Iveco’s three-month average share price of €16.02 (as of July 17, 2025).
  
• After deducting the expected dividend, the offer still represents a 34%–41% premium on a comparable basis.

Moreover, Tata Motors informed that it has secured full financing for the deal, providing certainty around payment and deal execution. The company has also committed to supporting Iveco’s current strategy and protecting the interests of its employees, suppliers, and customers. It has agreed to non-financial commitments regarding operations and employment for at least two years after the deal closes.