New Delhi: has raised its offer price for Iveco Group NV, but three major institutional shareholders have yet to tender their shares, putting the acquisition at risk as the 26 October deadline approaches. The tender offer had attracted acceptances for just 28.4% of the shares by the latest available count, with less than two weeks remaining.
The company raised its offer price by 2% to €14.40 per share on 9 October, after activist investor Petrus Advisers publicly rejected on 29 September, arguing that it undervalued the Italian commercial vehicle maker. The revised offer is Tata Motors’ “best and final” price, the company said.
The three investors—hedge funds Davidson Kempner and Syquant Capital, and activist investor Petrus Advisers—are among Iveco’s largest shareholders after its promoter, Exor. While Exor has tendered its stake, the three funds have not subscribed to the offer more than a month after it opened on 7 September. Together, they hold about 20.4% of Iveco’s common shares, according to an executive familiar with the matter.
Their participation could prove critical to Tata Motors securing the required shareholder support.
“The offer significantly undervalues Iveco relative to its peers. Second, Iveco’s shareholders do not receive an appropriate share of the synergy value this transaction creates: value Tata Motors has itself described to its own investors as substantial,” Petrus said in its 29 September statement.
“Third, shareholders should be compensated for the 15-month period between the announcement of the transaction and its expected closing,” the statement added.
Activist shareholders typically buy significant stakes in companies and push for changes they believe will unlock value for shareholders, including during acquisitions. Their position becomes particularly important during acquisition because their decision to tender or retain their shares can influence whether the buyer secures the required mandate.
Full and fair valuation
Tata Motors said the price increase was prompted by delays in completing the acquisition, which was it but is now . In its 9 October statement, the company said that the previous price already represented a “full and fair valuation” of Iveco, but that it had raised the offer to account for delays in obtaining regulatory approvals in some jurisdictions.
“The offeror hereby specifies that the new price is its best and final determination of the consideration under the offer and will not be increased further,” the company said.
The revised offer increases the deal value by about €81 million from the original €3.8 billion announced in July 2025.
Exor, Iveco’s largest shareholder, has tendered its 27.06% stake in the company’s common shares. Davidson Kempner holds about 10.17%, Syquant Capital about 6.45% and Petrus Advisers about 3.8%, according to the executive familiar with the matter. The exact breakup of the remaining shareholding, held by retail investors and global funds with smaller positions, was not immediately available.
The three investors did not respond to Mint’s queries on whether they were satisfied with the revised offer. Tata Motors reiterated its 9 October statement when contacted by Mint.
The delays
The deal, which has faced delays of at least two quarters, now faces the challenge of securing sufficient shareholder support before the deadline.
The offer requires acceptances representing at least 80% of Iveco’s common shares if shareholders approve the relevant resolution at the extraordinary general meeting (EGM) on 16 October. Otherwise, the acceptance threshold will be 95%.
Tata Motors could benefit from Exor’s voting power at the EGM. Although Exor holds 27.06% of Iveco’s common shares, its stake carries 43% of the voting rights, according to the information provided.
‘Push for better price’
“Tata’s offer needs 95% acceptance, which drops to 80% only if Iveco shareholders approve the back-end resolution at the 16 October EGM. With a bar that high, even a small group of holders can hold out and push for a better price, and that is how funds and activists usually work in European deals,” said Aurelia Menezes, partner at King Stubb & Kasiva, Advocates and Attorneys.
“A long approval process is costly for an offer like this: a fixed cash price loses value in real terms the longer it takes to close, and shareholders are left carrying the market risk while they wait. Raising the price is a fairly standard way of keeping them on board, and Tata has said those who have already tendered will receive the higher price automatically,” she added.
The role of activist shareholders was raised during Tata Motors’ FY26 fourth-quarter earnings call in May, when an analyst asked whether an activist hedge fund’s acquisition of a stake in Iveco could affect the deal’s closure or valuation.
“I think we are confident that the Iveco investor would see value in our offer and would support the deal flow,” GV Ramanan, chief financial officer at Tata Motors, said during the 13 May earnings call.
Tata Motors announced the acquisition on 30 July 2025 in an all-cash deal valued at €3.8 billion ($4.4 billion), excluding Iveco’s defence business. The transaction is intended to give Tata Motors a foothold in Europe and Latin America, broaden its truck and bus portfolio, and create a global commercial vehicle business with combined annual revenue of about €21 billion.
Iveco’s share price closed at €14.40 on 9 October, the day Tata Motors announced the revised offer. According to Tata Motors, the revised price represents a 6.77% premium to Iveco’s closing price on 29 July 2025, the last trading day before the acquisition announcement.