London - US carmaker Ford has narrowed the auction of its Jaguar and Land Rover marques to three bids, two of them involving Indian companies, people familiar with the matter said on Monday.
Indian carmaker Tata Motors as well as rival Mahindra &
Mahindra, which has teamed up with buyout firm Apollo, are both
set to make third round offers for the British luxury brands.
One Equity Partners, a buyout firm funded by US investment
bank JP Morgan, is also on the list, the sources said.
Ford is struggling with declining sales and a falling US
market share and announced last week it was nearing a deal to
shed Jaguar and Land Rover. At the time it posted a third
quarter net loss of $380m, compared with losses of $5.2bn a year earlier.
Ford has been exploring the sale of the brands since June as
it continues a global strategic review which led in March to the
sale of Aston Martin to a Kuwait-backed consortium in a 480
million pounds deal.
Mahindra & Mahindra, India's top utility vehicle and tractor
maker, initially pulled out of the process because it was only
interested in one of brands, whereas Ford wants to sell them
The Indian company rejoined the auction after partnering
with Apollo in a break-up bid that would give each one of the
Indian companies are becoming increasingly aggressive
acquirers outside their home market as they seek diversification
Tata Motors, India's top vehicle maker, has a joint venture
with Fiat to make premium cars for the Italian firm.
Ford invited six second-round offers earlier this month,
people familiar with the matter said at the time. It has now
evaluated them and selected the three parties it wants to fight
for the businesses, the sources said.
One of the sources said the bidders are now expected to
enter talks with trade unions and the UK government about
conserving jobs amid speculation some of the bidders may try to
move production outside the UK.
"We expect an agreement by early next year at the latest," a
spokesman for Ford said. Ford declined to comment further.
Buyout firms TPG, Terra Firma and Ripplewood were among
suitors that were expected to make second-round offers but were
not on the third-round shortlist.
Merrill Lynch analyst John Murphy at the time had valued the
two brands at as much as $1.5bn combined.