The British government, which has put stringent terms for guaranteeing the European Investment Bank’s (EIB) £340-million financial package to rescue Tata-owned Jaguar Land Rover (JLR), has been accused of trying to take control of the company “without putting a single penny upfront”.
The accusation by Howard Wheeldon, senior strategist at BGC Partners, followed the near collapse of talks between the government and JLR. “This latest government failure to support the future of the UK economy is an absolute disgrace—tantamount to throwing the best of the highly valuable British luxury car industry and export potential to wolves,” Wheeldon said to The Telegraph.
According to insiders, the Treasury and the Department for Business, Enterprise and Regulatory Reform have said that they will underwrite only £175 million of the European money for which the Tata Group must pay 15 per cent up front, effectively giving it access to only £150 million.
The government also wants some involvement in the control of the company. A spokesman for Jaguar Land Rover said, “We knew that these talks would be complicated and take some time. But talks are continuing.”