Post Jaguar and Land Rover, Tata Motors eyes Hummer

After the acquisition the famed Land Rover and Jaguar brands,Tata Motors has now found a new target worthy of its attentions!

News reports are coming in that Tata Motors is looking seriously at the available opportunity to purchase Hummer.

Industry insiders say that the Tata Motors, the Indian auto major (famous for its recent acquisition of Jaguar and land Rover, and the world’s cheapest car the Tata Nano) is talking to its shareholders for permission to raise £1.5 billion for a possible purchase of Hummer.

The money is to be used in further buyouts including a potential Hummer acquisition. The new fundraising initiative from Tata Motors has come on soon after three rights issues launched last month, which will raise $1.7 billion to finance the Land Rover-Jaguar buy. It has been reported that the company is also asking shareholders for permission to raise its borrowing limits by about £1 billion.

In a major expansion move, Tata Motors is planning to its product range and presence in the domestic and global markets in commercial and passenger vehicles, including through strategic alliances and acquisition opportunities. The company had already charted out mega plans to raise as much $1 billion from overseas debt and stock markets.

Meanwhile, it has been rumoured that the expensive financing risks are undermining Tata Motors’ acquisition of the Jaguar and Land Rover brands. It is said that Tata Motors was forced to take out an expensive bridging loan to fund the purchase and its bankers have been working hard to limit the cost of capital.

The company had reported a fall in net income at Rs 5.36 billion in the three months to the end of March, compared with RS 5.77 billion for the same period last year. Meanwhile, full-year profits saw a slow rise in at least five years, due to paltry demand in India.