According to reports, Tata Motors subsidiary, Tata Passenger Electric Mobility Ltd (TPEML) has signed a Unit Transfer Agreement (UTA) for the acquisition of Ford India’s manufacturing plant at Sanand in Gujarat for Rs. 725.7 crore.

Tata Motors will get entire land and buildings, vehicle manufacturing plant along with machinery and equipment situated therein, the Mumbai-based auto major said in a late-night notification to the stock exchanges.

As part of the agreement, all the eligible employees at the Sanand unit of Ford India will be transferred to Tata Motors, as per reports.

According to the company, Ford India will continue to operate its powertrain manufacturing facility by leasing back the land and buildings of the powertrain manufacturing plant from Tata Passenger Electric Mobility on mutually agreed terms.

As per reports, Tata Motors EV subsidiary also agreed to offer employment to the eligible employees of the powertrain manufacturing plant in case Ford India cessation of such operations.

The closure of the transaction will be subject to the receipt of relevant approvals from the government authorities and fulfilment of customary condition precedents. The government of Gujarat, TPEML and FIPL have already executed a tripartite MoU on 30th May 2022 to support all relevant approvals for the above transaction.

According to Tata Motors, The unit is adjacent to the existing manufacturing facility of Tata Motors Passenger Vehicles Limited at Sanand, which should help in a smooth transition.

This acquisition is timely and a win-win for all stakeholders. It will unlock a state-of-the-art manufacturing capacity of 300,000 units per annum which is scalable to 420,000 units per annum.

Shailesh Chandra, MD, Tata Motors says, “The agreement with FIPL signed today is beneficial to all stakeholders and reflects Tata Motors strong aspiration to further strengthen its market position in the passenger vehicles segment and to continue to build on its leadership position in the electric vehicle segment.”

Steve Armstrong, Transformation Officer, Ford Motor Company says, “The announcement marks an important step forward in the company's on-going business restructuring in India, which is part of its Ford+ plan for strategic transformation.”