25 September 2017 by lberuti
Last month, reports emerged that Fiat Chrysler is mulling a plan to spin-off Maserati and Alfa Romeo, the sports-car brands it owns, in order to sharpen its focus on mass market vehicles. VW ( Volkswagen AG ) is considering selling non-core assets such as the Ducati motorcycle brand. Meanwhile, senior officials of Tata Group, which owns TTMTIN (Jaguar Land Rover Automotive Plc), are said to believe the carmaker needs to bulk up to stay competitive. TTMTIN represents roughly 78% of Tata Motor’s revenues. It has not made any acquisition since it was bought for $2.4Bln in 2008, and the Indian conglomerate, which has amassed a record amount of cash – it currently sits on $6.2Bln - would be willing to provide financial support for potential deals. When investors heard that Tata could snap up a foreign automaker for its luxury Jaguar Land Rover brand, they pushed the latter’s 5-year risk premium 11bps wider at 190bps. Since the tights reached at the beginning of August, TTMTIN’s 5-year CDS has now widened by roughly 70bps.