Tatas on the road to more buyouts

20 September, 2007

Even as it's in the fray for the acquisition of Ford brands Jaguar and Land Rover, the Tata group is eyeing auto-parts makers in the US for acquisitions.

According to automobile industry reports, Tata AutoComp Systems, a supplier of vehicle components, is keen on an inorganic growth by way of buy outs. Tata AutoComp's activity in the United States is now limited to engineering and sales operations in Troy, Michigan. Tata had earlier in 2007 expressed keenness in buying out automotive-seat maker Lear Corp.

Analysts believe that any acquisition would add to Tata's US operations, which last year accounted for 31 percent of the company's $6.7 billion in revenue from international sales. The value of US and European mergers and acquisitions triggered by Indian buyers shot up by as much as 80 percent to $50.9 billion in June 2007 over June 2006.

And, this isn’t all. With interests in industries ranging from steel to IT, the Tatas are also looking for US acquisitions in hotels, beverages, and information technology, according to reports quoting company sources. The group was mulling a deal with French firm Valeo SA to buy parts or all of former Ford subsidiary Visteon Corp. Besides, the group had expressed interest in making an offer for Southfield, Michigan-based Lear, competing against billionaire Carl Icahn earlier in 2007. The Tatas, however, dropped out after a private-equity partner withdrew. Meanwhile, Tata Tea, whose brands include Tetley, is also seeking for similar deals' among US beverage companies.

Meanwhile, Tatas are in the race for the famed Ford brands. The American car major has said that it would announce the buyer for its UK-based luxury vehicle units by early 2008.