Indian Tata Motors to buy Italian Iveco for $3.8 billion

(Patria) - Tata Motors of India will buy the Italian Iveco group for 3.8 billion euros in an effort to create a "global champion" in the commercial vehicle sector, the two companies announced on Wednesday.

The agreement excludes Iveco's armored vehicle defense division, which will be sold to the Italian defense and aerospace group Leonardo, in a deal worth 1.7 billion euros, announced earlier on Wednesday, AFP reported.

The combined company, after Tata's acquisition, aims to sell around 540,000 vehicles annually for total annual revenues of 22 billion euros, of which half would come from Europe, 35 percent from India, and 15 percent from the Americas.
Tata and Iveco, which also produces engines and buses, said in a joint statement that there is "no overlap in their industrial and geographical footprints, creating a stronger, more diversified entity" that would benefit from a shared strategic vision to foster long-term growth.

The deal is expected to be finalized in the first quarter of 2026, which will highlight Tata's status in Europe, where Jaguar Land Rover is a wholly-owned subsidiary of Tata Motors.

"The strengthened outlook of the new combination is extremely positive in terms of employment security and the industrial footprint of the Iveco Group as a whole," said Iveco President Suzanne Heywood.

Iveco's defense unit sold

For Natarajan Chandrasekaran, Chairman of Tata Motors, "this is a logical next step after the separation of Tata Motors Commercial Vehicle business and will enable the combined group to compete on a truly global basis with two strategic home markets in India and Europe.

"The complementary businesses of the combined group and its greater reach will enhance our ability to invest boldly. I look forward to obtaining the necessary approvals and completing the transaction in the coming months," he added in a statement.

Iveco Group CEO Olof Persson said the merger "opens up new potential for further advancing our industrial capabilities, accelerating zero-emission transport innovation, and expanding our reach in key global markets".

"This combination will allow us to better serve our customers with a broader, more advanced product portfolio and deliver long-term value to all stakeholders."

Separately, Iveco's armored vehicle unit will be sold to Leonardo, whose head Roberto Cingolani said the move will make the company a "reference player in the European land defense market".

Leonardo announced plans to integrate its electronic systems, including next-generation combat sensors, into Iveco Defence vehicles to "guarantee optimal efficiency of the operational solutions offered".