India’s Tata Motors to acquire Italy’s Iveco for $4.4 billion

Indian Tata Motors will acquire Italy’s giant Iveco Group for 3.8 billion euros ($4.4 billion) in a bid to create a “global champion” in the commercial vehicles sector, the two companies announced officially Wednesday.

The deal excludes Iveco’s defense division for armored vehicles, which is to be sold to the Italian defense and aerospace group Leonardo in a 1.7 billion euro deal announced earlier on Wednesday.

The combined company, after Tata’s takeover, aims to sell around 540,000 vehicles a year for total annual revenues of 22 billion euros, of which half would come from Europe, 35% from India and 15% from the Americas.

Tata and Iveco – which also manufactures engines and buses – stated in a joint announcement that there was “no overlap in their industrial and geographic footprints, creating a stronger, more diversified entity.” This entity would utilize a shared strategic vision to drive long-term growth.

The deal is expected to close in the first quarter of 2026, underscoring Tata’s presence in Europe, with Jaguar Land Rover being a wholly owned subsidiary of Tata Motors.

“The reinforced prospects of the new combination are strongly positive in terms of the security of employment and industrial footprint of Iveco Group as a whole,” Iveco’s chairperson, Suzanne Heywood, said in the statement.

Defense unit

For Natarajan Chandrasekaran, chair of Tata Motors, “this is a logical next step following the demerger of the Tata Motors Commercial Vehicle business and will allow the combined group to compete on a truly global basis with two strategic home markets in India and Europe.

“The combined group’s complementary businesses and greater reach will enhance our ability to invest boldly. I look forward to securing the necessary approvals and concluding the transaction in the coming months,” he added in the statement.

Iveco Group’s CEO Olof Persson said the merger was “unlocking new potential to enhance our industrial capabilities further, accelerate innovation in zero-emission transport and expand our reach in key global markets.”

He added: “This combination will allow us to better serve our customers with a broader, more advanced product portfolio and deliver long-term value to all stakeholders.”

Separately, Iveco’s armored vehicles unit will be sold to Leonardo, whose chief Roberto Cingolani said the move would make it a “reference player in the European land defense market.”

Leonardo has announced it plans to integrate its electronic systems, including new-generation combat sensors, into Iveco Defense vehicles to “guarantee optimal effectiveness of operational solutions offered.”