Wrong Turn

12 March 2008 By William Echikson

Tata is finalising its purchase of Ford s UK luxury brands, probably for more than $2bn. The price reflects Land Rover s surprising turnaround. Tata is taking a big risk. But Ford would have been better off selling its more troubled premium brand Volvo.

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India's Tata Motors is expected to sign a memorandum of understanding to buy Ford Motor Co's luxury UK brands Jaguar and Land Rover within a few weeks.

There are no roadblocks holding back the deal, but negotiations have proved complex, union and company leaders say.

Negotiations are now focusing on the future relationship between Ford and the two luxury brands, which will continue to take Ford engines and body parts and will share technology and intellectual property rights, officials added.

Tata has been in talks with Ford since it was chosen as the frontrunner to buy the units a few days into 2008. India's top vehicle maker last week raised about $1bn to help fund the purchase.

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