The maker of Britain's prestigious Jaguar automobile has agreed to a $2.5 billion takeover by Ford Motor Co. that would give the U.S. automaker control of Jaguar stock and end weeks of bidding between Ford and General Motors.
Ford, which now owns about 13 percent of Jaguar PLC shares, offered $13.345 for each ordinary share, and the Jaguar board of directors was expected to recommend that shareholders approve the it.Jaguar said it would schedule an emergency meeting of shareholders. A 75 percent majority is neccessary to approve the $2.5 billion deal.
Jaguar, which gained 28 cents on London's International stock exchange Wednesday, tumbled 5 percent or 69 cents to end the day at $13.11 a share.
The agreement came two days after Secretary of Trade and Industry Nicholas Ridley said he would relax the government's "golden share" law, which bars foreign shareholders from holding more than 15 percent of the British luxury automaker.
In recent weeks, Jaguar has been the subject of a bidding war between U.S. auto giants Ford and GM, the top U.S. automaker.
GM said in a statement from its Detroit headquarters it would not bid for any Jaguar shares.
"After an intensive review of Jaguar's products and plants and in view of the losses currently being sustained by them . . . GM concluded that the maximum value that could be assigned to all of the Jaguar shares was very significantly below the $13.40 being offered, and that the premium of approximately $2 billion over book value at year-end 1988 could not be justified," GM said.
Ford said it would make a separate cash offer in the United States for all outstanding Jaguar shares at the same price offered in Britain.