Jaguar Land Rover is reported to be on the brink of being sold to French car maker PSA.
The PSA Group, which owns the Peugeot, Citroen and Vauxhall brands, is poised to step-in and take over the Coventry car maker according to the Press Association.
A Press Association report says leaked information suggests a sale of Jaguar Land Rover could be imminent.
It is understood a “post-sale integration document”, which outlines the benefits of the two companies joining forces, is already in circulation and the firms are exploring the detail of cost savings after a tie-up.
A tie-up could take the form of a merger but given PSA’s huge multi-billion pound turnover and Jaguar Land Rover’s current woes it is would be likely to be a takeover by the larger car maker.
Jaguar Land Rover is in the midst of a massive restructure after announcing a loss and slowing sales for the first time since it was acquired by Tata.
It is in the process of trying to save £2.5 billion and earlier this years announced it was cutting more than 4,000 jobs.
A spokesman for PSA, which already has its UK headquarters in Coventry, told the Press Association that the firm was in “no hurry” to make acquisitions and could “stand alone”.
However Pierre-Olivier Salmon added: “If an opportunity comes, like Opel (Vauxhall), we will consider it.”
PSA chairman Carlos Tavares has made no secret of his desire to acquire the UK-based luxury car manufacturer.
During an interview with Autocar India in April, he said he believed it would be good for PSA to have a luxury brand and that the company was “considering all opportunities”.
Sources inside Jaguar Land Rover told the Press Association that despite public statements downplaying the prospects of a tie-up, “things are moving quickly behind closed doors”.
One insider, who has seen the integration paperwork, said: “To have a document like this in circulation at the two firms points to the fact things are very far down the line with either a sale or acquisition.
“Both firms make cars in the UK.
“There are plenty of ways the two companies could save money by working together.”
CoventryLive has recently speculated on the potential sale of Jaguar Land Rover, suggesting there could be a number of potential buyers - including PSA, Fiat Chrysler and Volkswagen.
Experts have suggested a sale could be on the cards, including Dr Charles Tennant.
Dr Tennant is a former chief engineer at Land Rover and was also a director of Tata Motors’ European Technical Centre.
He told CoventryLive: “I fear that it is now inevitable that Tata Motors will off-load, especially now that their home Indian operations seem to have been turned around and are profitable again.”
Automotive industry expert Professor David Bailey of the Birmingham Business School (formerly of Coventry University) said the tie-up could be a good fit for both brands.
He said: “PSA said last month it was interested in acquiring Jaguar Land Rover but [its owner] Tata publicly ruled out a sale.
“Tata shareholders’ patience may be wearing thin, though, given recent Jaguar Land Rover losses. A partial sale may be an option.
“I’m sceptical about Jaguar Land Rover being able to go it alone bearing in mind the need for very high research and development spend on new technology given that the auto industry will transform itself in the coming years towards connected, autonomous electric cars.
“At some point Jaguar Land Rover may have to collaborate with another auto firm. A partial PSA stake might open that up.”
Tata Motors recently said “there was no truth to rumours that Tata Motors is looking to divest its stake in JLR”.
Jaguar Land Rover has been struggling in recent months, making redundancies across its business and cutting back production at its plants.
In February, it revealed a hefty quarterly loss of £273m in the three months to December 31, 2018, blaming Brexit uncertainty, slowing sales in China and declining demand for diesel vehicles.
PSA, meanwhile, has been flourishing since it bought Vauxhall-Opel in 2017.
It has returned the struggling brand to profit in less than two years and is cash-rich with revenue up 18.9 per cent in 2018 to £63.7m.
CoventryLive is attempting to contact Jaguar Land Rover for a comment.