Italy’s Agnelli family is reportedly in discussions over the potential sale of truck maker Iveco, with Tata Motors emerging as a possible buyer, according to three sources cited by Reuters. Two sources confirmed Tata Motors has approached Exor, the Agnellis’ investment firm, regarding its controlling stake in Iveco Group. The sale would exclude Iveco’s IDV defence division.

Exor and Iveco declined to comment, while Tata Motors did not respond to requests for comment.

Following the Reuters report, Iveco shares surged as much as 9.7 per cent on the Milan stock exchange, closing 8.3 per cent higher on Friday.

In May, Iveco announced plans to either spin off its defence business by the end of 2025 or sell it, having already received offers from prospective buyers.

A third source revealed that as the separation of the defence unit progresses, Exor has initiated talks with multiple non-European parties about a possible sale.

These talks involving Iveco’s sale and Tata Motors’ interest have not been previously disclosed.

Exor owns a 27.1 per cent stake in Iveco, controlling 43.1 per cent of voting rights in the Turin-based manufacturer, which also produces buses and engines. Iveco has a market capitalisation of approximately 4.2 billion euros (around Rs 360 billion).

Among Europe’s major truck makers — led by Volvo, Daimler and Traton — Iveco is the smallest and has frequently been considered a merger or acquisition candidate. However, its involvement in the sensitive defence sector has complicated potential deals and limited interested buyers.

In 2021, the Italian government blocked a bid for Iveco from Chinese firm FAW. At that time, Iveco was part of Agnelli’s industrial conglomerate CNH but was spun off and separately listed in early 2022.

Iveco has reportedly received three offers for its defence business, according to two sources: a joint bid from Italian defence company Leonardo and Germany’s Rheinmetall, and two others from Franco-German tank maker KNDS and arms manufacturer Czechoslovak Group. Bloomberg estimates the defence division’s valuation at up to 1.9 billion euros (around Rs 162 billion).

Iveco employs about 36,000 staff globally, including 14,000 in Italy.

Any transaction involving Iveco is expected to be subject to Rome’s ‘golden power’ legislation, allowing the government to impose conditions on deals involving companies considered of national strategic importance.