The European Commission has approved Tata Motors' acquisition of the Iveco Group (excluding its defense division) for 3.8 billion euros, removing the last regulatory hurdle for a deal aimed at creating a major global player in the commercial vehicle market. Brussels concluded that the merger does not pose risks to competition, given the limited combined share of companies in the European market.
Announced in July, the merger will combine Tata's forces in India with Iveco's established presence in Europe, forming a group that aims to achieve annual sales of more than 540,000 units and total revenue of 22 billion euros distributed between Europe (50%), India (35%) and America (15%). Iveco expects the merger to enhance its innovation potential, especially in the field of zero-emission technologies, while Tata sees this as a natural next step after separating its commercial vehicle division. The approval depended on whether Iveco would sell its defense business, which was sold to Leonardo for 1.7 billion euros in order to resolve strategic and geopolitical sensitive issues. This was the result of the pre-sale of Magirus, its loss-making firefighting subsidiary.
By advancing regulatory approval and withdrawing its defense operations, Tata can now focus on the industrial integration of Iveco's European businesses and positioning the new structure to compete with the world's leading truck and bus manufacturers in the face of accelerating electrification and technological change.
