Ford Motor Co. has picked India's Tata Motors Ltd. as
the top bidder to buy Ford's Jaguar and Land Rover units, the U.S.
automaker said Thursday.
Ford said it has entered into ``focused negotiations at a more
detailed level'' with Tata, which means Tata has been picked as a
preferred bidder for the storied British automobile brands.
``There is still a considerable amount of work to do, and while
no final decision has been made, we will proceed with further
substantive discussions with Tata Motors over the forthcoming weeks
with a view to securing an agreement that is in the best interests
of all parties concerned,'' Lewis Booth, executive vice-president of
Ford's European units, said in a statement.
Jaguar and Land Rover employees in the United Kingdom were told
about the negotiations Thursday morning shortly before the company
made the public announcement.
Ford executives have said they expect to announce the sale of the
two British automakers early this year.
Ford spokesman Jay Ward in London would not comment on how much
Tata bid for the automakers, nor would he say if the other two
bidders, Indian automaker Mahindra & Mahindra Ltd. and U.S. private
equity firm One Equity Partners LLC, were still in the running.
Last month people close to the negotiations said the potential
suitors had submitted bids that ranged from US$1.5 billion to $2
Cash-hungry Ford, which lost $12.6 billion last year but earned
$88 million in the first nine months of 2007, has been looking to
sell Jaguar and Land Rover.
It has mortgaged its assets to borrow money to stay operating and
expects to burn up $12 billion to $14 billion until 2009, when it
plans to return to sustained profitability.
Jaguar and Land Rover have been hit by unfavourable exchange
rates and high production costs in Britain.
Ford bought Jaguar for $2.5 billion in 1989 and Land Rover for
$2.7 billion in 2000, joining them with Aston Martin and Volvo to
form its Premier Automotive Group.
Earlier this year, Ford completed the sale of its controlling
stake in Aston Martin for $931 million in cash and preferred stock.
Ford has said it plans to keep Volvo for now, fixing its cost
structure and making it a more premium brand.