Tata Motors has secured a £175 million new loan for its UK subsidiary Jaguar Land Rover (JLR), taking the overall loan component to £500 million that the iconic British car maker has been able to get this year.
JLR said on Wednesday that it had secured a £175 million loan from the State Bank of India. This brings the overall loan that JLR has received this year to £500 million from financial institutions like Standard Chartered Bank, Bank of Baroda, and Burdale Financial Limited, a subsidiary of the Bank of Ireland.
The beleaguered car maker had received £57million export financing facility from ABC International Bank, £75 million from Bank of Ireland's UK finance arm, Burdale Financial Limited by mortgaging the stock and receivables of its Land Rover brand in the UK and the US, and the rest from Standard Chartered and Bank of Baroda.
After eight months of intensive negotiations with the UK government for underwriting the now-on now-off 170-million pound loan to JLR and the talks seemed to be going nowhere, Tata Motors rejected the "stiff" terms and conditions put by the UK government for passing the loan and said that it would source the funding elsewhere. (See: Flush with Irish funds, Tata Motors spurns UK bailout for Jaguar)
In a statement, chief financial officer of JLR Kenneth Gregor said, "We are pleased our funding plans are progressing and appreciate the confidence shown by our banking partners in our business."
The new loan will help JLR to accelerate its plans for investing in green technology vehicle, as well as producing the new baby Range Rover model at its Halewood plant.