Tata Motors acquires Nissan's South African plant
The Economic Times — November 7, 2006

Tata Group's international acquisition drive doesn't appear to be slowing down. After the mega deals announced in the steel and FMCG businesses, it's now the turn of the group's auto company to expand its global footprint and the destination is Africa. Tata Motors has acquired a South African manufacturing plant from Japanese auto giant Nissan. This marks yet another expansion of the Tata group in South Africa. While Tata Motors has a greenfield bus making unit in Johannesburg, Tata Steel is setting up a ferrochrome production unit and VSNL is a strong player in the telecom sector.

Tatas had earlier indicated that they would be making vehicles in South Africa though concrete plans — whether it was looking at a greenfield venture or eyeing the takeover of an existing unit — were not disclosed. The acquired facility in Pretoria has been engaged in making trucks for the $80.5-bn Nissan. It is not clear if Tatas would use this unit for making only commercial vehicles or also for producing its cars. The transaction value, which is expected to be modest, stands undisclosed.

A Tata Motors spokesman confirmed the deal saying, "The Nissan plant has been acquired by Tata Africa Holdings. Tata Motors is indeed looking at opportunities for assembling and manufacturing its vehicles in South Africa. Tata Motors will take this forward in partnership with Tata Africa Holdings." Sources say this latest acquisition is part of Tata Motors' overall strategy to locally assemble products in its important export markets.

The strategy is targeted at neutralising currency fluctuations. In South Africa, Tata Motors sold over 16,500 vehicles in '05-06. The models currently being sold include Indica, Indigo, Indigo Stationwagon , trucks and Tata Novus tippers .