Could JLR be gearing up to buy Ferrari?
THE ITALIAN BRAND COULD ADD SOME PIZAZZ TO ITS LINE-UP, SAYS EXPERT
COULD Jaguar Land Rover buy the most prestigious car brand in the world with its ‘war chest’ of billions?
The Coventry car maker is reported to be on the acquisition trail as it seeks to expand, and numerous marques it might buy have been mentioned.
Bloomberg recently cited anonymous sources which said Jaguar Land Rover was holding internal discussions about buying other brands to diversify the range of vehicles it sells and would consider purchases of luxury marques which fitted within its current portfolio.
But one expert has thrown a real wild card into the mix in the shape of Ferrari.
The legendary Italian sports car maker is generally acknowledged to be the number one automotive brand.
Currently owned by Fiat Chrysler Auto (FCA) it might not be for sale but there’s that old expression that everything is for sale if the price is right.
Mike Gould is an acclaimed author who has written a host of books on Land Rover and other British brands like Rover.
He is also a former public relations executive with the firm.
And he believes Ferrari could be the perfect fit for Jaguar Land Rover if it is in the business of buying new brands.
Speaking exclusively to the Telegraph Mike said: “With Tata Motors sitting on cash and other liquid reserves equalling $6billion, rumours abound that the company is about to embark on a shopping spree with motor brands and technology companies high on the list.”
So, what would the benefits be for Tata? The company is no doubt delighted with its £1.15billion purchase of Jaguar and Land Rover from Ford in 2008.
“It would certainly add to Tata’s credentials,” said Mike.
“There is no doubt that its biggest brand asset as the moment is Land Rover which can’t be far behind Ferrari in the brand equity stakes.
“It is also fair to say that Jaguar lags in image appeal despite recent upward strides. The fact that the F-Pace, the company’s first SUV, became its best-selling vehicle ever, speaks volumes.
“And, while Land Rover designer Gerry McGovern owns the high ground in 4x4 styling, the same cannot be realistically said of Jaguar’s Ian Callum for in sports car design, the Italians hold the crown.
“So, the addition of Ferrari to Tata Motors portfolio would certainly add some pizazz to the line-up.”
So, what might the hurdles be to Jaguar Land Rover brokering a deal, other than FCA not wanting to sell what is arguably its prize asset?
Mike said: “Acquiring Ferrari is going to involve some fancy financial footwork.
“In a complex deal, FCA has begun the process of a spin-off of Ferrari involving offering a small number of shares on the stock market and distributing the remainder to existing FCA shareholders.
“The Ferrari family also holds 10 percent of the company stock which they are unlikely to sell.
“So, while a simple outright purchase is not a possibility, buying up a controlling interest seems feasible given the right offer to shareholders.
“Whatever happens, Tata Motors won’t be letting $6 billion burn a hole in its corporate pocket.”