S Kalyana Ramanathan, London/August 12
Fraught four-month-long negotiation between Tata Motors-owned Jaguar Land Rover (JLR) and the UK government over a loan guarantee ended in an anti-climax today, with the Mumbai-headquartered automobile maker announcing that it has secured loans from commercial banks and would not need any support from the UK government.
Even though neither Tata Motors nor JLR specified how much it raised, it is understood that this could be in the vicinity of £175 million (Rs 1,400 crore).
Today's announcement comes a day after JLR said it had successfully secured a financing facility of up to £75 million (Rs 600 crore) for Land Rover's working capital needs from Burdale Financial Ltd, a member of the Bank of Ireland Group.
Tata Motors and JLR also expect a long-term loan from the European Investment Bank (EIB) of £340 million (Rs 2,700 crore) to be successfully secured in the coming weeks through "appropriate commercial arrangements".
"With the positive trend in the external environment in financial markets and improvement in general liquidity, these arrangements have been and are expected to be concluded without necessitating guarantees from the UK government, for which discussions had been ongoing for some time," said a statement from Tata Motors.
Tata Motors bought JLR from Ford Motor Company for $2.3 billion in mid-2008 and had funded this through $3 billion worth of debt.
For now, neither Tata Motors nor JLR are willing to share the source of this £175 million that has been secured. However, market sources said commercial banks both in India and the UK have agreed to lend money to JLR on commercial terms.
JLR's CEO David Smith said, "It is a positive sign for our business that we have been able to attract sufficient funding for our short-term needs through normal commercial means. This has always been our desired route and it clearly demonstrates recognition of the inherent strength in our business and faith in our future business plans."
Welcoming today's development, UK's Business Secretary Peter Mandelson said, "The fact that the banks and commercial capital markets are meeting JLR's funding is a clear sign of confidence in the company, its products and the automotive sector."
Tata Motors has been involved in tough negotiations with Mandelson to secure the UK government's support without any condition that might seemingly interfere with its day-to-day operations. Last month JLR reiterated its stand that it would not offer a board berth to the UK government in return for a loan guarantee.
The issue of securing a guarantee from the UK government came to an end today after Tata Motors' Chairman Ratan Tata wrote to Mandelson informing him that the company had secured loans without the UK government's aid.
Industry analysts, however, expressed disappointment at the fact that while JLR's competitors in France and Germany managed to get their respective government's support, iconic British brands had failed to get the UK government's support.
Showing posts with label Peter Mandelson. Show all posts
Showing posts with label Peter Mandelson. Show all posts
Wednesday, August 12, 2009
Thursday, June 25, 2009
India emerges as second biggest investor in UK
S KALYANA RAMANATHAN
London, 17 June
The UK Trade & Investment (UKTI) today said that India had emerged as the second largest investor in the UK in 2008-09, moving from the sixth position it had held in 2007-08 with a total of 108 successful projects being commissioned here from India. The first position however remained unchanged with the 621 successful projects from the US.
The UKTI, which is the UK government’s international business development organisation, though not a regulatory body like India’s FIPB, acts as a via-media for foreign investors in the UK and assists the government to frame investor friendly policies.
The ranking is done purely based on the number of unique investors in the UK and not by the value of such investments. This method, according to UKTI, reflects the number of investors that have committed their money in the UK and is not influenced by the value of these investments.
In 2008-09 India beat Germany, which held the second position in 2007-08. Germany moved to the forth position while France moved to third position from the fifth position it had held in 2007-08.
The number of investors from India increased by 44 per cent over the previous year, taking the total to 108 foreign direct investments projects in the UK. For this compilation the investments are broadly divided into three types – new projects, expansion of existing projects and mergers & acquisition. While the break up for investments from India was not readily available, UKTI’s managing director Brain Shaw said that on an overall basis 47 per cent of the FDI’s into UK in 2008-09 were new projects, while 27 and 26 per cent were expansions and M&As respectively.
India and China were the only two BRIC economies to be among the top 10 investing nations in UK. China improved its ranking from ninth position to eight in 2008-09. Brazil held the 28th position with 7 projects commissioned in the UK and Russia had no new investments into the UK in 2008-09.
Business Secretary Peter Mandelson said, “…these results are testament to the fundamental strengths of the UK’ s economy and will prove our ability to come through this downturn stronger, and ready for success.”
Ironically, Mandelson’s optimism was voiced on the same day the UK government also announced that the unemployment numbers in the UK increased to 2.26 million, the highest in 12 years.
Commenting on this, John Cridland, CBI Deputy Director-General said, “The numbers of jobless are continuing to rise and we’re clearly not through the worst yet. Sadly, the CBI expects these figures to continue to rise and peak at 3 million in the spring of 2010.
“Making job cuts is the last thing that businesses want to do, and the government must do everything it can to help firms keep people in their jobs, as well as giving advice, training and support to those who have become unemployed,” Cridland said.
The CBI (Confederation of British Industry) is the UK's leading business organisation, that speaks for for some 240,000 businesses that together employ around a third of the private sector workforce.
The UKTI further said that in 2008-09, FDI had created 35,000 new jobs. In the past six years over 2.15 lakh new jobs were created due to inward investment projects, said UKTI.
London, 17 June
The UK Trade & Investment (UKTI) today said that India had emerged as the second largest investor in the UK in 2008-09, moving from the sixth position it had held in 2007-08 with a total of 108 successful projects being commissioned here from India. The first position however remained unchanged with the 621 successful projects from the US.
The UKTI, which is the UK government’s international business development organisation, though not a regulatory body like India’s FIPB, acts as a via-media for foreign investors in the UK and assists the government to frame investor friendly policies.
The ranking is done purely based on the number of unique investors in the UK and not by the value of such investments. This method, according to UKTI, reflects the number of investors that have committed their money in the UK and is not influenced by the value of these investments.
In 2008-09 India beat Germany, which held the second position in 2007-08. Germany moved to the forth position while France moved to third position from the fifth position it had held in 2007-08.
The number of investors from India increased by 44 per cent over the previous year, taking the total to 108 foreign direct investments projects in the UK. For this compilation the investments are broadly divided into three types – new projects, expansion of existing projects and mergers & acquisition. While the break up for investments from India was not readily available, UKTI’s managing director Brain Shaw said that on an overall basis 47 per cent of the FDI’s into UK in 2008-09 were new projects, while 27 and 26 per cent were expansions and M&As respectively.
India and China were the only two BRIC economies to be among the top 10 investing nations in UK. China improved its ranking from ninth position to eight in 2008-09. Brazil held the 28th position with 7 projects commissioned in the UK and Russia had no new investments into the UK in 2008-09.
Business Secretary Peter Mandelson said, “…these results are testament to the fundamental strengths of the UK’ s economy and will prove our ability to come through this downturn stronger, and ready for success.”
Ironically, Mandelson’s optimism was voiced on the same day the UK government also announced that the unemployment numbers in the UK increased to 2.26 million, the highest in 12 years.
Commenting on this, John Cridland, CBI Deputy Director-General said, “The numbers of jobless are continuing to rise and we’re clearly not through the worst yet. Sadly, the CBI expects these figures to continue to rise and peak at 3 million in the spring of 2010.
“Making job cuts is the last thing that businesses want to do, and the government must do everything it can to help firms keep people in their jobs, as well as giving advice, training and support to those who have become unemployed,” Cridland said.
The CBI (Confederation of British Industry) is the UK's leading business organisation, that speaks for for some 240,000 businesses that together employ around a third of the private sector workforce.
The UKTI further said that in 2008-09, FDI had created 35,000 new jobs. In the past six years over 2.15 lakh new jobs were created due to inward investment projects, said UKTI.
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