Hours after Mumbai-based Tata Motors Commercial Vehicle and Iveco Group announced a definitive agreement to combine their commercial vehicle (CV) businesses in a landmark €3.8 billion all-cash deal, Palazzo Chigi (the official residence of the Prime Minister of Italy) and the entire Council of Ministers have pledged their support for the deal.
The acquisition will be executed through a voluntary tender offer for all common shares of Iveco Group (post-separation of its defence business), marking a strategic move to create a global leader in the commercial mobility space.
In a joint statement released on Thursday, Chigi and the Council of Ministers stated ‘”A major industrial transaction was announced today that opens up new growth prospects for the Iveco Group, a historic Italian company, and its employees, attracting the interest of Tata Motors, a large Indian multinational. The merger project represents recognition of the value of Italian technology” “India is a strategic partner with which Italy recently signed a joint plan to strengthen economic and industrial cooperation. This agreement is among the first concrete results of that shared journey”.
The statement from the office of Italian PM and his Council of Minister is important considering the fact that the regulatory approvals including merger control, foreign investment clearances, and EU Foreign Subsidies Regulation will also be required.
Together, Tata Motors’ CV business and Iveco Group will form a €22 billion revenue entity (Rs 2.2 lakh crore), with combined sales of over 540,000 units annually.
Revenue split will be approximately 50% from Europe, 35% from India, and 15% from the Americas, along with strong positions in Asia and Africa. The companies see strong complementarity in product portfolios, manufacturing assets, and geographic footprint—with minimal overlap.
Iveco’s powertrain business FPT Industrial, Tata’s reach in India and Asia, and combined R&D strengths are expected to drive growth in zero-emission mobility and sustainable transport solutions.
Emphasizing that the production facilities will remain in Italy, the plan is to maintain the direct employment, related industries, and supply chains. “No relocations are envisaged; instead, the focus is on solid international expansion through a collaboration with one of the world’s leading vehicle manufacturers, avoiding operational overlap but offering clear growth opportunities” the statement added.
Tata Motors has agreed to a set of non-financial covenants valid for two years post-settlement, including no job cuts or plant closures as a direct consequence of the deal. The transaction ensures protection of employee rights, long-term strategy continuity, and the integrity of Iveco’s brands and operations.
The statement further highlighted that the Iveco’s Defence Vehicles business has been sold to Leonardo, which is in line with the strategy of leveraging a manufacturing hub of excellence in differentiated but related sectors. Both projects aim to fully develop their potential while remaining firmly anchored to protecting fundamental national needs.
“The Government supports quality foreign investments and will closely monitor the operation’s progress to ensure the protection of jobs, strategic resources, and the production chain. The Executive remains available to collaborate with all stakeholders to achieve a result beneficial to our nation. In any case, the Government will ensure the protection of all strategic assets in accordance with current regulations”