Tata Technologies Ltd (TTL), the 94.6% subsidiary of Tata Motors, has made a cash offer of £53.4 million (Rs 411 crore) to acquire 100% equity in UK-based automotive and aviation design and engineering firm £65.3 million Incat International Plc. The offer, which has been accepted by Incat's board, is being made through TTL's Nevada, US-based subsidiary Tata Technologies Inc. It will pay $4 for every Incat share, a premium of 4% to the closing price of 211.5 pence on August 17 on the London Stock Exchange.

The acquisition will give TTL access to Incat's 2000 clients primarily in the aerospace and automotive space, including Ford, DaimlerChrysler, Honda, Boeing, Airbus and Lockheed. Tata Motors' bid to acquire Incat is in line with the trend among global car majors to design their cars inhouse. The BMW Group, for instance, owns DesignworksUSA, an industrial design firm in California. Toyota owns Calty Design Research Inc in the US and it also partners with design houses like Italdesign-Giugiaro to develop specific models.

Ford Motor also owns the London Design Enterprise. It had also hired Dilip Chhabria's DC Designs for its latest Aston Martin. High-end automotive designing is likely to get group chairman Ratan Tata's personal attention since he has expressed a desire to start a design firm after retirement. Incat is a debt-free, cash surplus company. Established in 1989, it posted a turnover of £65.3 million in 2004. "The operations of Incat and Tata Technologies complement each other.

We would use a right mix of onshoring and offshoring to be cost effective," said Pravin Kadle, executive director, finance, Tata Motors, speaking to FE.