On 26 of March came the news which we all were anticipating and were very eager to hear about.

TATA motors has finally,officially,bagged the two coveted luxury brand, Jaguar and Land Rover. Ford and TATA motors closed the deal at $2.3 billion. TATA can now boast of having the ultimate spectrum (in terms of prices) as they are going to be the makers of the world’s cheapest car NANO ( Nano :TATA Motors’s Rs 1 Lac($2,500) car) ,and, Jaguar and Land Rover being the costly mean dream machines.
The acquisition of JLR will put TATA strongly on the global scene. TATA already became a well known name in automative market when they showcased the cute NANO, the $2500 car, doing something which( making a car in $2500) was considered to be impossible and was termed as un-doable by many. Now after having JLR in their kitty they will be taken much more seriously and respectfully. Also it will be a good opportunity for the Indian car maker to look into the advance engines of the new sophisticated cars and learn from their designs.

But what effect will it put on TATA motors, finacially?

At $2.3 billion, the deal amounts to ~32% of TATA Motors annual sales of $7.2 billion last year. So the deal is bound to make an impact.Also,not to forget, the two brands TATA got are already running into loss. TATA will raise a loan amount of $3 billion from a consortium of banks led by SBI to fund the deal. But due the the international liquidity crises and increased interest rate, they will have to pay back more.

Hope this does not turn out to be a bad deal for TATA and its worth the effort!