New Delhi/Mumbai: Regulatory approvals in Europe for Tata Motors Ltd’s $4.4 billion acquisition of Iveco are running behind schedule, potentially pushing the closure of its largest-ever buyout past the April-June target, according to two persons in the know.
Pending clearances from the European Central Bank and the European Commission could delay revenue recognition and integration plans, adding near-term uncertainty even as the company continues to engage with regulators for an early closure.
“Approvals from European Central Bank and European Competition Commission are still pending, which should have come a couple of months back. The deal is running behind schedule,” one of the persons mentioned above said on the condition of anonymity.
In a 12 February presentation to investors, Iveco had noted that the timeline proposed by Tata Motors suggested all regulatory approvals should be in place by the end of the March quarter.
After all regulatory approvals come through, Tata’s offer will be submitted to Italy’s securities market regulator Commissione Nazionale per le Società e la Borsa (Consob), following which the offer will be formally launched. An extraordinary general meeting will be held by Iveco after the offer launch, following which the offer will formally conclude, the presentation had said.
Subject to approvals
“The proposed transaction remains subject to receipt of customary regulatory approvals, which are currently under review and in process by the relevant authorities across jurisdictions,” a Tata Motors spokesperson told Mint in an emailed response.
“Most approvals have already been received and those pending are being actively worked upon for earliest closure. Tata Motors continues to engage constructively with the relevant regulators and will provide updates, as appropriate,” the spokesperson added.
The company has so far not changed the earlier stated timeline of closure of the deal by end April to the June quarter, hoping that all the regulatory approvals will be in place soon.
Tata Motors announced the acquisition of the Agnelli family-backed Iveco and its powertrain business in July 2025 for a total amount of $4.4 billion. Iveco was the commercial vehicle arm of Italian major Fiat before it was spun off into a separate firm. Both are part of the Agnelli family's business empire.
The combined Tata Motors and Iveco group is seen establishing a significant global presence, with sales of over 540,000 units and over $25 billion in revenue. Europe would account for half of the combined group's total sales, followed by 35% in India and the remaining 15% in the Americas.
Before Iveco, Tata Motors' largest acquisition was Jaguar Land Rover in 2008 for $2.3 billion. The buyout is the Tata Group's second largest after Tata Steel Ltd’s takeover of the Corus Group for $13.1 billion in 2007.
Not uncommon
Regulatory delays are not uncommon, industry experts said.
“It is a delay, but regulatory approvals do take time. And typically, some delay would have been budgeted,” said Subhabrata Sengupta, partner at Avalon Consulting.
The delay in regulatory approvals also comes at a time when some analysts raised concern over Iveco's declining cash flow outlook. The Turin-based company cut its full-year 2025 guidance for its commercial vehicle and defence business by 82% in January to €60 million from €350-400 million.
Analysts at Motilal Oswal Financial Services on 30 January flagged a lack of visibility in Iveco’s financials due to uncertainty in the markets it operates in, including Europe and Latin America.
“Its (Tata Motors) recent acquisition of Iveco would expose it to the ongoing global macro uncertainties, thereby driving a potential de-rating if the demand environment does not improve anytime soon,” analysts said in the note.
However, other analysts also said that the conclusion of the deal and the successful integration would aid Tata Motors' global prospects.
Pramod Kumar, Vedant Kshatriya, and Hemal Bhundia of UBS Securities wrote in a 27 January note that the acquisition will widen the company's reach across geographies. “We expect the transaction to be value-accretive for Tata Motors. Given its smaller scale relative to peers, we expect improving trucking volumes in Europe to support margin expansion and bolster cash flows, as the overall demand environment in the region continues to strengthen,” the UBS analysts said.