Iveco Sells Truck Business to Tata, Defense Unit to Leonardo
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Iveco Group NV agreed to break itself up, selling its defense unit to Leonardo SpA and the rest of the Italian truck maker to Tata Motors Ltd. in deals totaling about 5.5 billion euros ($6.3 billion).
Leonardo will pay 1.7 billion euros including debt for the military vehicle business, according to a statement July 30. The rest of Turin-based Iveco, which makes a range of commercial trucks and buses, is set to be acquired by Tata for about 3.8 billion euros.
Acquiring Iveco’s truck operations would give Tata a toehold in Europe’s commercial-vehicle industry, boosting the Indian firm’s presence in a major market nearly two decades after purchasing Jaguar Land Rover in 2008. Tata also gains design and technology capabilities in areas like sustainable transport that can help its appeal with European buyers.
The billionaire Agnelli family’s Exor NV holding company, which controls Iveco, has agreed to sell its 27% financial stake to Tata, according to the statement.
Iveco shareholders are set to receive €4.10 euros per share from the Tata deal and an extraordinary dividend of about 5.5 to 6 euros per share from the Leonardo transaction, according to the statements.
Iveco said July 29 that it was in advanced discussions on a two-part deal to sell itself, confirming earlier reporting by Bloomberg.
Iveco is selling its defense unit to selling its defense unit to Leonardo SpA . (Nick Paleologos/Bloomberg)
The company employs about 36,000 people, mainly in Europe, with just under 40% of its workforce in Italy, according to its annual report. It also has manufacturing in France, Germany, the U.K., China and Latin America.
Trucks and buses made up the bulk of the company’s 15.3 billion-euro in 2024 revenue, while defense accounted for less than 10%. The company also has a significant powertrain division.
For Leonardo, gaining Iveco’s military vehicles helps the larger Italian firm consolidate its position in the European land defense sector, it said July 30. The deal with Leonardo, which faced pressure from rival suitors, keeps the defense operations in local hands, satisfying a key demand of the Italian government.
Tata’s move comes as the Indian automaker undergoes a demerger to separate its commercial and passenger-vehicle businesses by March.
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Iveco will help the largely India-focused commercial vehicle division expand its overseas footprint, just as the $2.3 billion JLR acquisition elevated Tata’s status in the global luxury car segment.
Tata Motors shares fell 3.5% in Mumbai on July 30, highlighting investor concerns around the acquisition and pushing this year’s decline to more than 10%.
Iveco, which is controlled by Fiat’s founding Agnelli family, said on Tuesday that it was in advanced discussions on a two-part breakup and sale, confirming earlier reporting by Bloomberg.
