Tata may need to invest $1B in Jaguar

 India's Tata group may have to spend at least $1 billion to revive premium brands Jaguar and Land Rover, which were bought by Tata Motors earlier this year, the Economic Timesreported on Tuesday.

Tata Sons, the holding company that holds large stakes in group firms, and unlisted financial services unit Tata Capital are among the options being considered to raise the cash, the newspaper said, quoting unnamed company sources.

"We will do everything in our ability to resource all our operations," the paper quoted a Tata Motors' spokesman as saying. Tata Motors paid $2.3 billion to buy Jaguar and Land Rover from Ford Motor Co. earlier this year, just as global auto sales began collapsing. He declined comment on the size of funds required.

A spokesman for Tata Motors could not be immediately reached by Reuters for comment.

On Monday, UK's Financial Times had reported that Tata Motors had agreed to inject "tens of millions of pounds" into Jaguar and Land Rover to prevent an immediate cash flow crisis.

Tata Motors, which has a market value of about $1.5 billion, has dropped 74 percent so far this year while the main BSE index is down more than half.

GM and Ford merger was discussed

A merger of U.S. automakers General Motors and Ford Motor was discussed, but shot down at a recent management meeting at GM, according to an article in the July 7 edition of Business Week.

The idea was floated by a senior GM executive, but set aside as such a deal could be a huge distraction and double many of the numerous problems that both companies are facing, said the report, citing someone familiar with the discussion.

However, such a deal would have some merit, as merging the massive overheads of both companies could save billions and their combined cash hoard of $50 billion could help them weather the downturn in automotive sales, the article said.