Mitsubishi, Mizuho to lend $803 mn

Mitsubishi UFJ Financial Group Inc and Mizuho Financial Group Inc will lend up to 80 billion yen ($803 million or Rs 3,200) to Tata Motors Ltd to help fund its purchase of Ford Motor Co's Jaguar and Land Rover brands.

The Japanese banks will provide about 40 billion yen each to India's biggest truckmaker, which is borrowing $3 billion (about Rs 12,000 crore) from a group of banks, said Mitsubishi UFJ spokesman Tomohiro Kato and Mizuho spokeswoman Masako Shiono.

Ford agreed to sell Jaguar and Land Rover to Tata for $2.3 billion (about Rs 9,200 crore) yesterday. Citigroup Inc, JPMorgan Chase & Co, BNP Paribas SA, ING Groep NV, Standard Chartered Plc and State Bank of India Ltd will provide the rest of the financing, said two people with direct knowledge of the deal, declining to be identified because the information hasn't been made public.

Japanese banks including Mitsubishi UFJ are increasing lending abroad as borrowing declines at home. Japan's four largest banks boosted lending overseas by 47 per cent to 30.7 trillion yen in the 18 months through September 2007, according to Standard & Poor's. JPMorgan was among the group of banks that arranged financing for Tata, Hong Kong-based bank spokesman Ray Bashford confirmed, while declining to comment on the size of its loan. Spokespeople at the other five banks did not return phone calls.