Ford Says 'Tata' to Jaguar, Land Rover

Mulally has said the company would invest the proceeds from the sale in quality and product development at Ford.

Ford named Tata as the preferred bidder for the British automakers in January, essentially dismissing two other bids.

Cash-hungry Ford, which lost $12.6 billion in 2006 and $2.7 billion last year, has been looking to sell Jaguar and Land Rover for months.

It has mortgaged assets to continue operations and expects to burn up $12 billion to $14 billion until 2009, when it plans to return to sustained profitability.

Jaguar and Land Rover are strained by unfavorable exchange rates and high production costs in Britain.

Tata Motors is part of Tata Group, India's oldest and largest conglomerate. The family business is owned mostly by Tata-funded charitable trusts. A substantial portion of the group's income is channeled into various philanthropies that have helped build some of the country's finest institutions, including India's first cancer hospital.

Tata companies are known for offering worker benefits that are rare in India, including pension and child care allowances.

Some experts believe the group still is too bloated. Ratan Tata concedes he has "not been very successful" at pruning the number of companies and downsizing staff, which currently totals about 290,000.

Among Tata's holdings are steel makers and a consulting service that does software engineering and other work for western firms.

Ford shares edged up a penny to $6.01 in morning trading Wednesday. They have traded in a 52-week range of $4.95 to $9.70.