From The Economic Times · Sangita Mehta and Kala Vijayraghavan · · 1m 20s
JLR seeks $1.3B loan as Tata leadership drama looms
Jaguar Land Rover is raising funds from global banks, but lenders worry about uncertainty at its parent company's helm.
In brief
Jaguar Land Rover is raising funds from global banks, but lenders worry about uncertainty at its parent company's helm. Leadership instability at Tata Sons is making banks hesitant to commit to JLR's fundraising, though the automaker says operations won't be affected. Originally reported by The Economic Times.
JLR seeks $1.3 billion loan
Jaguar Land Rover has started talks with eight or nine global banks to raise about 1 billion dollars through a five-year term loan.
Banks flag Tata leadership risk
Some lenders suggested JLR delay fundraising until there is clarity on whether N Chandrasekaran will continue as Tata Sons chairman, since he also leads JLR.
Tata Trusts opposes extension
Tata Trusts chairman Noel Tata opposed the Tata Sons board decision to give Chandrasekaran a five-year extension, creating uncertainty about his future.
JLR confident on fundraising
JLR executives say parent company leadership issues have no direct bearing on operations and the automaker will successfully raise the funds.
“Tata group has never been impacted by such issues in the domestic or global markets”
Loan terms and participants
The term loan will carry a fixed spread over SONIA at under 200 basis points. Banks involved include HSBC, Citibank, MUFG, DBS and BNP Paribas.
Earlier bond plans postponed
In March, JLR indefinitely postponed a 500 million dollar senior unsecured bond issue due to global market volatility following geopolitical tensions.
The big picture
Leadership instability at Tata Sons is making banks hesitant to commit to JLR's fundraising, though the automaker says operations won't be affected.
