Tata, the Indian conglomerate, is poised to hire advisers to help restructure its estimated £2bn debt burden on Jaguar Land Rover.
A senior banking source said that "the message from Tata" was that an appointment was likely within three months. However, Tata executives will deal directly with banks on short-term issues, such as relaxing certain covenants, or terms, on the debt.
"Tata knows something needs to be done to make the loan easier to repay, like a refinancing, but for now the groups feels it is in control of the situation," said the source. "However, Tata is considering bringing someone on board to help with longer term issues."
Tata Motors bought Jaguar and Land Rover, both based in the Midlands, from the US car giant Ford for $2.3bn at the start of last year. It took up a bridging loan to fund the deal, and Tata has been in talks with its banks about a refinancing, due this summer.
The car industry has been badly hit by the credit crunch, particularly newly built vehicle sales. The European Investment Bank announced last week that it would lend £450m to Jaguar Land Rover and the UK operations of Nissan. This is part of the Business Secretary Lord Mandelson's pledge in January to offer £2.3bn to the industry in financial assistance.
Tata has been pushing the Government to help it protect Jaguar Land Rover. The conglomerate originally pushed Lord Mandelson to provide £1bn over two years, as it looked to maintain working capital during the slump in the luxury car market.
Ratan Tata, the group's chairman, said in an interview last month that he estimated £500m was necessary to ensure that it could complete major technology projects that would be implemented in new models.
The EIB loan will be used to help Jaguar Land Rover finance research into cutting carbon emissions. Tough emissions targets will be introduced by the European Union in 2012.
Tata has become one of the world's best known businesses, and also counts Corus, the steel giant, among its UK assets. The conglomerate has more than 80 businesses across the globe, featuring in every major international market.
The group bought Jaguar Land Rover following a drawn-out auction process, in which it battled with rival Indian company Mahindra. Union concerns delayed the deal, but these were placated when Tata effectively guaranteed jobs in the short term by agreeing to stick with Ford's business plan to 2011.
Ford has been selling its European assets for the past few years. In 2007, it sold Aston Martin for $848m to a consortium led by automotive entrepreneur David Richards. The US giant is currently considering the sale of Swedish subsidiary Volvo. Ford has started taking indicative bids, and Volvo has attracted interest from several Chinese companies.Reuse content