Ford sells Jaguar and Land Rover to Tata

Ford Motor Co. has agreed to sell its Jaguar and Land Rover operations to India's Tata Motors Ltd. for $2.3 billion. Ford, however, agreed to infuse $600 million into the Jaguar and Land Rover pension funds after the deal closes around the end of June. The deal remains subject to various regulatory approvals.

The sale of the two European brands culminates a key part of Ford's ongoing restructuring program, which is expected to improve the company's focus on its core Ford brand. The final proceeds to Ford will be $1.7 billion after the sale is completed and the pension plans are funded. Ford will retain no ownership stake in the British brands, a company spokesman confirmed today. Most of the Jaguar-Land Rover management team, including CEO Geoff Polites, will transfer with the operation to Tata, a Ford spokesman said. "Jaguar and Land Rover are terrific brands," said Ford CEO Alan Mulally.

"We are confident that they are leaving our fold with the products, plan and team to continue to thrive under Tata's stewardship. Now, it is time for Ford to concentrate on integrating the Ford brand globally." As part of the transaction, Ford said it would continue to supply Jaguar and Land Rover "for differing periods" with powertrains, stampings and other vehicle components along with a variety of technologies. The length of supply arrangements differ depending on the component.Ford declined to say how long the supply arrangements run for specific components.

"We have enormous respect for the two brands and will endeavor to preserve and build on their heritage and competitiveness, keeping their identities intact," Tata Chairman Ratan Tata said in a statement. "We aim to support their growth, while holding true to our principles of allowing the management and employees to bring their experience and expertise to bear on the growth of the business."