8 banks may join SBI to fund Jaguar bid

Atleast four public sector banks and four foreign lenders are likely to join the State Bank of India-led consortium to raise $3 billion to fund Tata Motors' foreign acquisitions including the $2 billion Jaguar and Land Rover deal.

The public sector banks that may join the consortium of financiers are Bank of India, Bank of Baroda, Indian Overseas Bank and Syndicate Bank, while the foreign banks are Barclays, HSBC, DBS and the Singapore-based United Overseas Bank, a source close to the development, said.

"SBI is looking at enhancing the number of entities in the consortium to 20 so that the burden of financing such a huge sum can be distributed," the source added.

The country's largest lender has already started talks with banks that would be a part of the consortium, including Citi Bank, JP Morgan, Standard Chartered, BNP Paribas, Tokyo Mitsubishi UFJ and Mizuho Financial Group. It will issue an official announcement soon, the source said.

Sources said SBI plans to raise the amount by the second half of April to enable Tata Motors to complete the acquisition soon.

SBI has emerged as the leading merchant banker in the country over the past two years. The bank sealed around 40 deals worth about $27 billion in 2007-08 and this contributed significantly to its revenues.