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| JLR secures 170 mn pound loan from GE Capital: report |
| Press Trust of India / London Nov 16, 2009, 12:49 IST |
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Tata group-owned Jaguar Land Rover (JLR) has secured a 170 million pound (about $284 million) loan from GE Capital in a move to strengthen its financial position, media report says.
The deal is expected to be announced today. "Jaguar Land Rover will announce today that it has secured a new 170 million pound working capital facility from GE Capital" the Financial Times reported.
The daily further said that, "The five-year loan is an important step for the loss-making car company owned by India's Tata Motors, as it seeks to shore up a financial position weakened by the credit crisis and falling sales of its luxury vehicles."
JLR would avail the said loan from GE Capital -- the financing arm of US-based General Electric as soon as it rolls off its three UK production lines.
"It will boost working capital within the company by shortening the 30-40 day gap it typically has to wait between producing hundreds of thousands of cars a year and delivering them to dealerships in 90 countries," it added.
Citing GE Capital Chief Executive Officer (distribution finance business) Rich Green, Financial Times said "having identified a large group of assets that had been underutilised we looked at how working capital can be freed up from them and we found a solution."
"We are talking to several other European car makers about a similar facility, but as far as we know this is the first of its kind," Green added.
Tata had been seeking government loan guarantees for a 340 million pound European Investment Bank loan to fund its investments in emissions-cutting technology, and for up to 500 million pound of commercial bank loans.
The Indian conglomerate has pumped more than 1.2 billion pound into JLR to cover losses since it bought the businesses from Ford Motor for $2.3 billion last year.
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