Tata Motors has signed MoU with Gujarat govt for the potential acquisition of Ford India’s Sanand plant
Homegrown auto major Tata Motors on Monday announced that it’s subsidiary has signed Memorandum of Understanding (MoU) with the government of Gujarat for the potential acquisition of Ford India’s Sanand plant.
“Tata Passenger Electric Mobility Limited (TPEML), a subsidiary of Tata Motors Ltd, and Ford India Private Limited (FIPL), have today signed a Memorandum of Understanding (MOU) with the Government of Gujarat (GoG) for the potential acquisition of FIPL’s Sanand vehicle manufacturing facility,” the Tata Group firm informed in an exchange filing.
The potential acquisition will include land & buildings, vehicle manufacturing plant, machinery and equipment and transfer of all eligible employees of FIPL Sanand’s vehicle manufacturing operations, subject to the signing of definitive agreements and receipt of relevant approvals. FIPL will operate its Powertrain manufacturing facilities by leasing back the land and buildings of the Powertrain unit from TPEML.
The Ford India vehicle manufacturing site at Sanand is a state-of-the-art site. TPEML would invest into new machinery and equipment which is necessary to commission and make the unit ready to produce its vehicles.
With the proposed investments, it would establish an installed capacity of 300,000 units per annum, which would be scalable to more than 400,000 units, and anticipates it to take a few months. The MOU will be followed by signing of the definitive transaction agreements between TPEML and FIPL over the next few weeks.
“This MOU for a potential acquisition of this unit, is a win-win for all stakeholders and helps Tata Motors accelerate the enhancement of its PV/EV manufacturing capacity. This unit is adjacent to the existing manufacturing facility of Tata Motors Passenger Vehicles Ltd at Sanand, which should help in a smooth transition,” the company added.
Shares of Tata Motors were trading over 2% higher at ₹439 apiece on the BSE in Monday’s early deals. The auto stock is down about 11% in 2022 (YTD) so far.
