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• INDIAN CONTRACT ACT, 1871


 A contract is an exchange of promises between two or more

parties to do or refrain from doing an act which is enforceable in a
court of law. Section 2(h) defines a contract as an agreement
enforceable by law.


 Contract= Agreement + Enforceability at law



• MERGER


 Merger is defined as:

 1. combination of two or more companies into a single
company where one survives and the others lose their
corporate existence.
 2. The survivor acquires all the assets as well as liabilities
of the merged company or companies.
 Generally, the surviving company is the buyer, which retains
its identity, and the extinguished company is the seller.


The acquisition process can be divided into a planning stage
and an implementation stage.
 The planning stage consists of:
 1. development of the business and the acquisition plans.
 The implementation stage consists of:
 1. search
 2. screening
 3. contacting the target
 4. negotiation
 5. integration.


 Documents required completing the transaction of a merger

or an acquisition are:-


• Loan agreements, trademarks and trade names

• Supplier and customer contracts
• Distributor and sales representative agreements
• Insurance policies and claim pending
• Articles of incorporation, bylaws and corporate seals.
• Employee incentive programs

 INTRO ABT DEAL
• Tata Motors Ltd announced a $2.3 billion deal
to buy Jaguar and Land Rover from Ford
Motor Co, a transaction that gives the
Indian automaker a line-up ranging from the
world's cheapest car to some of its more
expensive.
•
• Acquisition of these brands resulted in
stamping their authority as a takeover
tycoon.
•
• They beat compatriot Mahindra and Mahindra
• For Tata, which plans to launch the ultra-cheap Nano or "People's
Car," the addition of the profitable Land Rover brand provides
an edge against Indian rival Mahindra & Mahindra Ltd which
had also pursued a deal with Ford.
•
• Ford, for its part, gets to shed the money-losing Jaguar brand and
gains a cash infusion at a time when the U.S. market is
slumping and it is attempting to bounce back from combined
losses of more than $15 billion over the past two years.
•
• The sale price is roughly 40 percent of what Ford paid for the two
brands. Ford acquired Jaguar for $2.5 billion in 1989, but failed
to turn the British nameplate into a higher-volume brand. Ford
paid $2.75 billion for Land Rover in 2000.
•
• The all-cash deal, which was agreed in March, includes all
necessary intellectual property rights, manufacturing plants,
two advanced design centers in the UK and a worldwide
network of sales companies. Included in the deal were the
rights to three other British brands, Jaguar's own Daimler, as
well as two dormant brands Lanchester and Rover.
•
 Company Profile - TATA
• Tata Motors Limited, established in 1945, is India's largest automobile company, with
consolidated revenues of Rs.70,938.85 crores (USD 14 billion) in 2008-09.
•
• It is the leader in commercial vehicles in each segment, and among the top three in
passenger vehicles with winning products in the compact, midsize car and utility
vehicle segments. The company is the world's fourth largest truck manufacturer,
and the world's second largest bus manufacturer.
•
• The company's 23,000 employees are guided by the vision to be "best in the manner
in which we operate, best in the products we deliver, and best in our value
system and ethics.“
•
• The company's manufacturing base in India is spread across Jamshedpur (Jharkhand),
Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and
Dharwad (Karnataka).
•
• The company’s dealership, sales, services and spare parts network comprises over
3500 touch points; Tata Motors also distributes and markets Fiat branded cars in
India.
•
• True to the tradition of the Tata Group, Tata Motors is committed in letter and spirit to
Corporate Social Responsibility. It is a signatory to the United Nations Global
Compact, and is engaged in community and social initiatives on labour and
environment standards in compliance with the principles of the Global Compact.
• 1945 - Tata Engineering and Locomotive Co Ltd (TELCO) set up as a locomotive
maker at the end of World War Two
1954 - Company shifts to making trucks in a joint venture with Germany's
Daimler Benz


 1961- Company starts exporting of commercial vehicles.

1977 - Commences production of commercial vehicles
1994 - Enters venture with Daimler to make Mercedes Benz cars in India
1998 - Launches fully indigenous passenger car, the Indica
2001 - Ends joint venture with Daimler
2002 - TELCO renamed Tata Motors Ltd
2003 - Announces plan to build world's cheapest car, to sell for 100,000 rupees
2004 - Acquires South Korea's Daewoo Commercial Vehicle Co, and lists on the
New York Stock Exchange. Launches Indigo sedan
2005 - Buys 21 percent stake in Spanish bus maker Hispano Carrocera SA,
launches mini-truck Ace in India
2006 - Signs manufacturing and distribution agreement with Fiat, enters
venture with Brazilian bus maker Marcopolo
2008 - Unveils the Nano at Delhi Auto Expo
- Buys Jaguar and Land Rover from Ford Motor Co for $2.3 billion
 Company Profile - Ford
• The Ford Motor Company is an American
multinational corporation and the world's fifth
largest automaker
• Based in Dearborn, Michigan, a suburb of Detroit, the
automaker was founded by Henry Ford and
incorporated on June 16, 1903.
• In addition to the Ford, Lincoln and Mercury brands,
Ford also owns Volvo Cars, and a small stake in
Mazda and Aston Martin. Ford's former UK
subsidiaries Jaguar and Land Rover were sold to
Tata Motors.
• Ford introduced methods for large-scale
manufacturing of cars and management of an
industrial workforce using elaborately engineered
manufacturing sequences typified by moving
assembly lines. These methods came to be known
around the world as “Fordism”.
 Jaguar and land rover
•
• Jaguar Cars Ltd., better known simply as Jaguar is a British luxury car manufacturer,
• headquartered in Coventry, England.
• Jaguar was founded as the Swallow Sidecar Company by Sir William Lyons in 1922,
originally making motorcycle sidecars before switching to passenger cars.
• The name was changed to Jaguar after World War II.
• Following several subsequent changes of ownership since the 1960s, Jaguar was
listed on the London Stock Exchange and became a constituent of the FTSE 100
Index, which ended when Ford acquired Jaguar in 1989.
• Jaguar also holds Royal Warrants from HM Queen Elizabeth II and HRH Prince Charles.
•
• Land Rover is a 4x4, SUV and all-terrain vehicle manufacturer.
• based in Solihull, West Midlands, England.
• Originally the term Land Rover referred to one specific vehicle , a pioneering civilian
all-terrain utility vehicle launched on 30 April 1948, but was later used as a brand
for several distinct models, all capable of four-wheel drive.
• Starting out as a model in the Rover Company’s product range, the Land Rover brand
developed, first as a marquee, then as a separate company, developing a range
of four-wheel drive capable vehicles under a succession of owners, including
British Leyland, British Aerospace and BMW.
• In 2000, the company was sold by BMW to the Ford Motor Company.
• Land Rover is one of the longest surviving four-wheel drive (4WD) brands.
• The use of Land Rovers by the British and Commonwealth military, as well as on long
term civilian projects and expeditions, is mainly due to the marquee's off-road
 MARKET SPECULATIONS & ANALYSIS

Fo rd b o u g h t Ja g u a r fo r £ 1 . 6 b n in 1 9 8 9 a n d it is b e lie ve d th a t Fo rd h a ve
in ve ste d a b o u t $ 1 0 b n in Ja g u a r sin ce it b o u g h t, Fo rd b o u g h t th e La n d
R o ve r fro m B M W fo r £ 1 . 7 b n in 2 0 0 0 .

A n a lyst exp e ct a n yth in g b e tw e e n $ 2 . 5 b n to $ 3 b n fo r Ja g u a r a n d La n d

R o ve r.
A M e ryllLyn ch a n a lysts su g g e st th a t Ja g u a r a n d La n d R o ve r m a y fe tch
a b o u t $ 1 . 5 b n e a ch ( £ 7 3 5 m ).

E a rlie r a p riva te e q u ity firm ca lle d A lch e m y Pa rtn e rs w a s sa id to b e

lin in g u p a £ 3 b n o ffe r fo r th e tw o lu xu ry b ra n d s. “ If yo u lo o k a t th e
fin a n cia lp o sitio n , [ Ja g u a r a n d La n d R o ve r] a re w o rth so m e $ 1 b n to
$ 1 . 5 b n ,” M r D o rris a n a n a lyst sa id . “A d d a co n tro l p re m iu m , a n d th e
fin a lsa le s p rice co u ld co m e in a t a b o u t $ 2 . 5 b n .”
 PROBLEMS FACED BEFORE
ACQUISITION
Jaguar’s sales were down nearly 32 percent for 2006 in
the United States, the company’s largest market.

Jaguar lost more than $715 million in 2006 and is

expected to lose $550 million in 2007. According to the
analysis, Jaguar is projected to lose more than $300
million in 2008 and is not expecting a profit for several
years.
These losses are mainly because of extremely high
manufacturing costs in Britain and Ford has not earn a
profit from jaguar since it bought.
Union Leaders of Jaguar and Land Rover had raised
concerns about the job security because of the sale.
The worried jaguar ’s workers, they told “if the two
companies are sold together, then there was no
guarantee “that a new owner would not shut down
most of Jag’s manufacturing capacity”.
European Commission

O n 2 6 th April 2008 ,
T h e E u ro p e a n C o m m issio n ( E C ), th e exe cu tive p a n e lo f th e 2 7 -
m e m b e r E u ro p e a n U n io n , cle a re d th e a cq u isitio n o f th e Ja g u a r a n d
La n d R o ve r b u sin e ss ( JLR ) o f U S -b a se d Fo rd M o to r C o m p a n y b y In d ia ’ s
Ta ta M o to rs Ltd .
T h e E C a n n o u n ce d h e re Frid a y th a t it h a s g ra n te d cle a ra n ce u n d e r th e
E U M e rg e r R e g u la tio n .
Ta ta M o to rs m a n u fa ctu re s p a sse n g e r ca rs, co m m e rcia lve h icle s a n d
b u se s p rim a rily in In d ia a n d se lls lig h t co m m e rcia l ve h icle s a n d
p a sse n g e r ca rs in th e E u ro p e a n e co n o m ic a re a .
Ja g u a r m a in ly m a n u fa ctu re s lu xu ry p a sse n g e r ca rs a n d La n d R o ve r
p ro d u ce s sp o rts u tility ve h icle s.
T h e o p e ra tio n w a s exa m in e d u n d e r th e sim p lifie d m e rg e r re vie w
p ro ce d u re , n o te d a n E C sta te m e n t.
O T H E R C O M P E T IT O R S
M&M which wants to be global SUV maker should have an
interest, at least, in Land Rover, says the brand is attractive.
Even so, it will not help Mahindra become an independent
global sports utility vehicle, or SUV, brand. Moreover, Land
Rover, which is about six times as big as M&M, might simply
be unaffordable.  
M&M says they have interest in Land Rover, SUV maker, but
they say that Ford wants to package both brands together.
Actual reason is M&M cannot afford both the brands
together..

Among the PE firms named as potential bidders said to have

approached Ford were Ripplewood Holdings, and One Equity
Partners, one of whose senior partners included Jacques A
Nasser, the former chief executive of Ford.
From India utility vehicles maker Mahindra & Mahindra was
keen on acquiring Land Rover and had joined One Equity to
put in a bid for it.
E AFord
S O which
N F Ohas
R become
S A L Estruggling
o f B R Aautomaker
N D S in recent
years posted a full-year 2006 net loss of $12.7 billion, the
largest single-year loss in the company’s history.

Also Ford lost its No. 2 ranking worldwide to Japan’s Toyota.

Ford Chief Executive Officer Alan Mulally, who took over the
top post in September 2006 from Bill Ford has been
restructuring Ford to counter losses.

As a part of restructuring Ford has been selling assets in a

bid to offset falling sales and profits. Premier Group, which
includes Aston Martin, Volvo, Land Rover and Jaguar is the
main cause for Ford continuing losses.

Earlier this year Ford sold its UK based sports car division
Aston Martin for $848 million.

Ford reported a loss of $282m for the first three months of

2007.
REASON FOR TATA GOING FOR
THE ACQUISITION
Ta ta w a n te d to m a ke a g lo b a l im p a ct a n d it th in ks th a t b u yin g th e se
b ra n d s a t a lo w e r ra te n o w , w ill g ive b e tte r va lu e la te r o n .

T h is a cq u isitio n a lso e a se s th e e n try o f Ta ta in E u ro p e a n m a rke t w h ich

it h a s b e e n e ye in g fo r lo n g . A p re vio u s JV w ith FIA T to o k p la ce , th is w ill
fu rth e r h e lp th e m p e n e tra te E U m a rke t.

- Long term strategic commitment to automotive sector.

- Opportunity to participate in two fast growing auto segments
( premium and small cars ) and to build a comprehensive product
p o rtfo lio w ith a g lo b a l fo o tp rin t im m e d ia te ly.
-In cre a se d b u sin e ss d ive rsity a cro ss m a rke ts a n d p ro d u ct se g m e n ts
-U n iq u e o p p o rtu n ity to m o ve in to p re m iu m se g m e n t w ith a cce ss to
w o rld cla ss ico n ic b ra n d s
-La n d R o ve r p ro vid e s a n a tu ra l fit a b o ve T M L ’ s U tility
V e h icle s/ S U V / C ro sso ve r o ffe rin g s fo r th e 4 x4 p re m iu m ca te g o ry
-Ja g u a r o ffe rs a ra n g e o f “ Pe rfo rm a n ce / Lu xu ry ” ve h icle s to
b ro a d e n th e b ra n d p o rtfo lio
-S h a rin g o f b e st p ra ctise s b e tw e e n Ja g u a r, La n d R o ve r a n d Ta ta
M o to rs in th e fu tu re
Tata is very famous for acquisitions of
companies going in losses or JV’s with
companies, primarily in BUS Divisions…
In 2004 it acquired Tata Daewoo
Commercial Vehicle and in late 2005 it
acquired 21% Aragonese Hispano
Carrocera giving it controlling rights of
the company. It has formed a Joint
Venture with Marcopolo of Brazil and
introduced low-floor buses in the Indian
Market. Recently it had acquired British
Jaguar Land Rover (JLR) business, which
also includes Daimler and Lanchester
brand names
backbone of Ford’s luxury stable. This surprise move from Ford is to ease the pressure
mounting on it by trade unions and the British government. Ford is already seeking assurances
that whoever buys the two firms will keep all the UK factories, Coventry, Birmingham,
Liverpool for Jaguar and West Midlands for Land Rover—open for at least five years to
safeguard UK jobs. It also mirrors similar deals that global car makers have announced in
recent months. When Ford sold Aston Martin in May this year to a Kuwait-based consortium of
bankers for $925 million, it chose to retain a 15% stake. Daimler too retained a 20% stake in
Chrysler when it was sold to private equity firm Cerberus Capital Management for $7.5 billion
the same month.
Real cause:
* But Ford’s new move is seen as an effort to keep private-equity buyers involved and ratchet
up competition. Since current turmoil in the debt markets, where private-equity firms often
turn to fund their deals would result in lesser interest from them.
* Also the important reason is to woo several private-equity firms participated in the first round
of bidding who are now wary of stricter European Union emission norms scheduled to take
effect in 2012. Jaguar and Land Rover — niche makers of sports cars and sport-utility vehicles,
respectively — will be hurt because they don’t have broader fleets including more-fuel-efficient
cars to offset their less-efficient models. Also since unlike another car company, private-equity
bidders likely won’t have other auto operations, especially any with more-efficient vehicles
that could bring down a fleet fuel-economy average. The commission enacting emission norms
has said it intends to require Europe’s car makers to reduce the average carbon-dioxide levels
of new cars by roughly 20% over current levels to 130 grams per kilometer by 2012, it hasn’t
specified how this will be enforced. The EU could apply its 2012 target to the industry as a
whole, with some car makers compensating for others, or it could make the target binding on
each company’s fleet of vehicles. A binding mandate could challenge niche brands such as
Jaguar and Land Rover. By retaining a stake, Ford might be able to assuage the concerns of
prospective buyers, as the relatively low emissions levels of Ford’s small cars sold in Europe
could offset the higher emissions of Jaguar and Land Rover models, depending on how the new
rules are crafted.
Bidders way:
OAO Russian Machines, which owns the OAO GAZ car group, said in a statement on its website
that it is not interested in acquiring the Ford Motor Co’s Land Rover and Jaguar brands. GAZ
appeared in a number of press reports as one of the parties that expressed interest in buying
TATA’s Indica Launch
To compete with global competitors Tata Motors launched their so called India's first
indigenously designed and manufactured car in 1998. Contrary to popular belief, the car was
not designed in India. The outer body styling was done by an Italian design house called IDEA
Institute, under contract from Tata Motors. Though the company created a record by received
nearly 115,000 bookings in the 1 week, The car that was inadequately tested for quality went
through a near-death experience with more than 50,000 customers cancelling their orders
immediately thereafter due to teething quality problems before it was revived around 1999-
2001.

Indica’s global debut as CityRover

In 2003 the TATA’s Indica was launched in Britain in tie up with MG Rover, The car dubbed as
CityRover was a quick and inexpensive way to access the city car market. However MG Rover's
great hopes on Tata’s CityRover were dashed on the rocks by buyer apathy.
The company refused to provide a test car to the BBC's Top Gear programme, so presenter
James May went to a showroom in disguise (with a camera hidden on his tie) and took a
CityRover for a test drive. He later stated it was "the Worst Car he had ever driven on Top
Gear," with "a ride that is harsh yet bouncy at the same time" and "a quick but needlessly loud
engine".
In the summer of 2004, just one year after the CityRover's launch, MG Rover announced to
replace it with an all-new model.
 Deal Process
•
•
•
 Funds
• Citigroup and JPMorgan are the lead advisors to the deal, which is
the largest cross-border auto acquisition by an Indian company.
The deal is expected to close by the end of June 2008, subject
to regulatory approvals and the achievement of financial
closure.
• The transaction is significant for a number of reasons. Coming as
it does amidst a global freeze in credit markets; it shows that
top-notch Indian companies have the ability to raise large
amounts of money at reasonably low rates of interest.
• Besides the two US banks, the bridge loan is being underwritten
by a consortium of eight banks — State Bank of India, Bank of
Tokyo-Mitsubishi UFJ, BNP Paribas, ING, Mizuho and Standard
Chartered.
• The loan has been structured in the form of step-up financing: for
the first six months, the interest charge would be Libor (London
Inter-Bank Offered Rate) plus 70 basis points and for the next
six months, it would be 140 basis points over the benchmark
rate. The six-month Libor is currently at 2.63%. The bridge loan
is being raised by a special purpose vehicle — Tata Motors UK,
which will own these two brands, banking sources said. Tata
Motors UK is 100% owned by Tata Motors.
• On 18 March 2008, Reuters reported that American bankers
Citigroup and JP Morgan shall be due underwriting a loan of
After the acquisition of British Jaguar Land Rover (JLR) business, which also includes the
Daimler and Lanchester brand names Tata Motors became a major player in the international
automobile market. Tata has gained the rights to the Daimler, Lanchester, and Rover Company.
In addition to the brands, Tata Motors has also gained access to 2 design centres and 2 plants
in UK. The key acquisition would be of the intellectual property rights related to the
technologies.

The rumor that Ford will contribute to pension funds associated with the brands is also true, as
it confirmed that $600 million will be dropped into the retirement coffers of the brands once
the deal closes. It is, of course, subject to regulatory approval in a number of countries, but the
automaker expects the deal to be done by the end of the following quarter.
As part of the deal, Ford will continue to supply powertrains, stampings and other unnamed
vehicle components to Tata for "differing periods", as well as R&D research, environmental and
platform technologies, and even accounting services, among others. Clearly the ties that bind
Jaguar Land Rover to Ford are strong and will take some time to undo.
Judging from the press release, it seems all parties involved, including the employees of Jaguar
Land Rover, are pleased with how the deal went down, and for the time being both brands will
be run business as usual during the transition period.

The key challenge for the new owner of Jaguar and Land Rover will be to grow and maintain
sales of the two brands in a global downturn and credit crunch.

Tata Motors will have to commit significant managerial and financial resources to engineer a
turnaround. It will have
to significantly step up its R&D budget as well as increase operating expenditure and capital
expenditure to meet JLR’s requirements. Auto analysts tracking the development say the
acquisition was just the first step; the real challenge lies in running JLR.
• 27th July 2009
The steep downturn of the world's luxury automotive markets
has taken a toll on Jaguar/Land Rover, and the company's
bottom line has taken a huge hit as a result. Financial Times
report that says Tata Motors' British luxury brands lost 673.4
million pounds ($1.11 billion U.S.) in 2008. That's a $2 billion
swing from the 641.5 million pound ($1.05 billion) profit the
British brands earned in 2007.
Tata Motors said last month that Jaguar/Land Rover lost 306
million pounds ($504 million) for the fiscal year ending March
2009.
Tata Motors reported a net loss of Rs3.29bn ($67 million) for the
quarter to end-June, compared with a Rs7.2bn profit a year ago.
It said it made a standalone profit of Rs5.14 billion, up 58 per
cent on a year ago, not including the losses at JLR.
The Financial Times report comes as Tata Motors is working out
a deal with the British government to provide short-term
financing for the cash-strapped automaker. The report that says
the U.K. government is willing to provide a 175 million pound
($288 million) commercial bridge loan to keep operations
running. The reports says Tata Motors would like a 12-month
loan, while the British government would like a six-month term,
The fact that Jaguar Land Rover accounted for $504 million of that $520 million total loss
means that more job cuts and plant shutdowns are in store for the ailing British duo. Says Tata
Vice Chairman Ravi Kant:
“We have sent people on sabbatical, gone for cheaper low-cost country sourcing and tight
control in cash flows, and are assisting JLR (Jaguar Land Rover) for a major belt tightening.”
Earlier this month, it was reported that Tata was in search of some £1 billion ($1.5B) in cash
and underwriting help to pump into the JLR operations.

Jaguar's bail-out
Published: December 19 2008 02:00 | Last updated: December 19 2008 02:00
Peter Mandelson, Britain's business secretary, is contemplating a bail-out of Jaguar Land Rover.
It is hard to imagine a less deserving candidate. The luxury carmaker fails the public interest
test on two key grounds. First, its products are of questionable social utility. For the
government to allocate scarce funds to prop up the production of the 4.2 Litre V8 Petrol
Supercharged Jaguar is a nonsense. It has a top speed of more than 150mph, emits 299g of
carbon dioxide per kilometre and costs about three times the average annual wage. True, the
UK car industry employs 190,000 people directly and supports several hundred thousand more
once components and retailing are taken into account. But if Mr Mandelson wants the
government to underwrite this £50bn industry, he should harness such public funds as are
available to develop the green cars of the future, not pander to vested interests.
The second reason Mr Mandelson should refuse to bail out JLR is that Tata Motors, the Indian
company that paid $2.3bn for it, is capable of doing so itself, if it wishes. Tata Motors, let it not
be forgotten, is a subsidiary of Tata Group, one of the wealthiest companies on the
subcontinent, with revenues of $62.5bn and profits of $5.4bn last year. The argument that
thousands of jobs are at stake is weak: sectors employing many more, such as retail, receive
no special treatment. If job protection starts to drive government policy, then the UK would bar
Tata Consulting Services, a sister company, from offering the type of business process
outsourcing services that have sucked back-office jobs to India in their hundreds of thousands
during the past decade. But that would be nutty. Manufacturers are now leaner precisely
because they now manage their inventory, process warranty claims and order spare parts
through TCS's offshore centres . The simple truth is that Tata Motors overpaid for a trophy
asset with poor prospects. It must sort it out itself.
• Mr Kant said that Tata Motors was finalising the £100m of loans from
commercial banks including Standard Chartered, Bank of Baroda, ING, GE
Capital, and Bank of Ireland subsidiary Burdale.
• Analysts said it would take much more than £100m to turn around JLR’s
fortunes, given the depressed state of the global premium car market. Tata’s
core commercial vehicles market in India is also suffering from slower sales.
• “We’ve seen the bottom of the luxury market, but the road to recovery will be
slow,” said Ashvin Chotai, director of consultancy Intelligence Automotive
Asia. “JLR will continue to be a drain on Tata’s financial resources for a
while.”
• JLR has been a burden for Tata since its carmaking arm bought the two brands
from Ford Motor for $2.3bn last year, just as demand for large and
expensive vehicles began to plummet.
• Since then, Tata has poured more than £1bn into the carmakers, which have
three plants and employ 14,500 people. It has eliminated more than 2,200
jobs, and in July said it had appointed KPMG and Roland Berger to advise it
on cost-cutting and cash management.
• Last month Tata and JLR ended long-running discussions with the UK
government over emergency financing for the two carmakers. Tata had been
seeking government guarantees for a £340m European Investment Bank
loan to finance JLR’s investments in lower-emission products, including a
planned compact Land Rover model, plus guarantees for up to £500m of
commercial bank loans.
• At the time, JLR said it had lined up commercial lending to meet its needs,
including the EIB loan, and that it would no longer need UK government
guarantees. Tata had balked at conditions attached to any lending by the
 OUR LEARNINGS
• OFFER AND ACCEPTANCE
 The deal was offered by Tata and finally accepted on 2nd
June 2008 by William Clay Ford (Chairman of Ford) and Allan
Mulally (CEO of Ford)
 OFFER BY TATA  ACCEPTANCE BY FORD


• LEGAL RELATIONSHIP
  Both the parties have the intention to create legal Relationship
between them and were agreed to legalize the deal in written
 
• LAWFUL CONSIDERATION
 

 Consideration is lawful in the deal. Mr. Ratan Tata (Chairman of Tata)

gets the Ford Company as his consideration.

•
• LEGALITY OF OBJECTS
 In Tata Ford deal nothing was illegal, immoral or opposed to public
policy hence legality of object criteria also got fulfilled.
• CAPACITY OR COMPETENCY OF PARTIES 
 There are three conditions that are required for a party to
become competent to contract were fulfilled:-
 -Both the parties attains the age of majority at the
time of contract.
 -Both the parties are of sound mind
 -Both Tata and Ford were not disqualified by any law
from signing any contract.
•  FREE CONSENT 
 In this case the consent of both the parties are free i.e. It is not
caused by-
 Coercion Undue Influence
Fraud
 Misrepresentation
Mistake
   
 


• POSSIBILITY OF PERFORMANCE
   In this deal both the parties were able perform there respective
promises.
 


• LEGAL FORMALITIES