Tata Motors' provisional Iveco holding exceeds 89% after tender

Tata’s 14.4-euro-per-share offer values Iveco at $4.36 billion

A majority of Iveco Group shareholders have tendered their shares into Tata Motors’ proposed takeover, satisfying the threshold condition the offer required, according to a filing published by Iveco on behalf of Tata. The filing said Tata Motors had provisionally reached a shareholding of more than 89% of Iveco’s common share capital, net of treasury shares, and that the acceptances mean the threshold condition for the proposed takeover has been satisfied.

Market data embedded in the source report showed Iveco Group’s IVG quote up 0.74% and Tata Motors’ 544569 quote up 3.00%. Those figures come from the source’s own market-data display for the two companies.

Tata Motors, which is part of Tata Group, agreed last year to purchase Iveco’s commercial vehicles business. The Indian automaker’s proposal values the Italian commercial vehicle manufacturer at around $4.36 billion, and the deal would first require the spinoff of Iveco’s defense business.

Tata Motors raised its offer earlier this month to 14.4 euros a share, 30 cents higher than the 14.10 euros Tata Motors initially offered. The filing at the time said the increased price would give the company an equity value of 3.905 billion euros ($4.36 billion).

The shareholding figure carries two qualifiers from the filing itself. Tata Motors’ holding is described as provisional, and the stake is measured net of treasury shares. The filing, published by Iveco on behalf of Tata, is the source for both the acceptance figures and the threshold determination.

Iveco previously said that its board fully supported the initial offer and recommended that shareholders accept it, and Iveco later added that it welcomed the increased price. That recommendation came before the tender acceptances reported in a filing published by Iveco on behalf of Tata.

The deal would first require the spinoff of Iveco’s defense business, which Italy’s Leonardo agreed to buy earlier this year. That separation precedes the sale of the commercial vehicles operation to Tata Motors.

With the threshold condition satisfied, Tata Motors’ proposed purchase of Iveco’s commercial vehicles business has cleared the shareholder-acceptance requirement of a deal the two companies agreed last year. For Iveco shareholders who tendered, the price is 14.4 euros a share; for Tata Motors, the acquisition brings Iveco’s commercial vehicles operation once the defense business is separated.

The separation of Iveco’s defense business, which Leonardo has agreed to buy, is the step the transaction’s structure requires before the commercial vehicles sale. On the shareholder side, the condition Tata Motors had to meet is now met, with the acceptances reported in a filing published by Iveco on behalf of Tata.