June 2012

Strategy

How far will the Jaguar leap? Corporate Turnaround of JLR

Tata Motor’s acquisition of Jaguar Land Rover is one of the most discussed cases of a successful outbound acquisition by an Indian company.  Since the past few years, Jaguar Land Rover Plc (JLR), the UK based subsidiary of Tata Motors has consistently been the major driving force behind the revenue and profits for the company and has helped the company to plug losses in the domestic business. The trend continues, with Tata Motors’ profit having tripled in this quarter of 2014, on strong Jaguar, Land Rover sales. Such splendid performance of the acquired company was almost unimaginable for many in 2008. Flashback to June 2008. Tata Motors had acquired two iconic British brands – Jaguar and Land Rover (JLR) from the US-based Ford Motors for US$ 2.3 billion. This was the biggest buy-out in the automobile space by an Indian company. Ford Motors Company (Ford) had acquired Jaguar from British Leyland Limited in 1989 for US$ 5 billion. After operating it for losses for few years, in June 2007, Ford had decided to divest the brands as a part of its restructuring strategy. Tata Motors was interested in acquiring JLR as it would reduce the company’s dependence on the Indian market and facilitate Tata Motor’s…

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