Jaguar Land Rover has told the British government that it no longer needs its support, after obtaining private funding.
JLR owner Tata Motors said it had secured direct bank loans believed to be worth £175 million, as well as guarantees that would allow it access to a £340m European Investment Bank loan.
Government funding via a £170m bridging loan was offered earlier this year but did not materialise, after JLR and the government wrangled over the terms of the agreement
In a letter to Lord Mandelson, Tata chairman Ratan Tata said he hoped the funding that had been secured would help it "succeed in re-establishing these venerable British brands to their earlier glory".
”Tata Motors and Jaguar Land Rover also expect that the long-term loan from the European Investment Bank of £340m, sanctioned to Jaguar Land Rover, can also be successfully secured in the coming weeks through appropriate commercial arrangements," Tata said.
”With the positive trend in the external environment in financial markets and improvement in general liquidity, these arrangements have been, and are expected to be, concluded without necessitating guarantees from the UK government, for which discussions had been ongoing for some time.”
Business secretary Peter Mandelson said, "The fact that the banks and commercial capital markets are meeting JLR's funding is a clear sign of confidence in the company, its products and the automotive sector.
"This is a good and encouraging outcome for JLR, its workforce and its supply chain."
Mandelson added that the government had offered bridging finance and would be "willing to help again if necessary".