In a strategic move to expand its global footprint in the commercial vehicle sector, India’s Tata Motors has announced the acquisition of Italian truck manufacturer Iveco in a deal valued at €3.8 billion (around RM19.4 billion). The agreement, finalised on Wednesday, marks a significant milestone for both companies and follows a separate transaction in which Iveco’s defence division, IDV, will be sold to Italian aerospace and defence giant Leonardo.

The all-cash transaction will see Tata launch a tender offer for all Iveco shares at €14.10 apiece, contingent upon the successful completion of the defence business sale. The acquisition is aimed at integrating two companies whose commercial vehicle operations are said to be highly complementary, with minimal industrial or geographic overlap.

Tata’s offer has received the backing of Exor, the holding company of Italy’s influential Agnelli family. Exor currently controls a 27.1% stake in Iveco, with 43.1% of the company’s voting rights. It has agreed to transfer its entire stake to Tata, effectively facilitating the acquisition.

Following the merger, the combined group is expected to command a substantial presence in the global commercial vehicle industry, with annual sales exceeding 540,000 units and total revenues approaching €22 billion. While Tata Motors already owns British luxury automaker Jaguar Land Rover, its presence in the European commercial vehicle sector has been virtually non-existent until now. Iveco’s strong base in Europe—where 74% of its revenues were generated in 2023—makes it a strategic fit for Tata’s ambitions to expand beyond Asia.

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