Mahindra, which has joined private equity firm Apollo Management LP to bid for the British automakers, is competing against another Indian automaker, Tata Motors Ltd., and U.S. private equity firm One Equity Partners LLC, said the person, who requested anonymity because the talks are private.
All three bidders were meeting Tuesday with the British government, labor unions and Ford about the sale, the person said.
Labor unions in the United Kingdom are seeking assurances that the sale would not affect employment levels. Combined, Jaguar and Land Rover employ about 15,300 in the U.K.
Cash-hungry Ford, which lost $12.6 billion last year but turned an $88 million profit in the first nine months of 2007, has been looking to sell Jaguar and Land Rover.
It has mortgaged its assets to borrow money to stay operating and expects to burn up $12 billion (8.12 billion EUR) to $14 billion (9.47 billion EUR) per year until 2009, when it plans to return to sustained profitability.
Jaguar and Land Rover have been hit by unfavorable exchange rates and high production costs in Britain. Ford doesn't break up its earnings for these units.
Jacques Nasser, Ford's chief executive from 1999 to 2001, is involved with the bid from One Equity Partners, an affiliate of JPMorgan Chase & Co.
Former Ford President Nick Scheele joined with New York-based Ripplewood Holdings LLC in its bid for Jaguar and Land Rover, but Ripplewood is out of the running, said the person briefed on the talks.
Ford spokesman Tom Hoyt would not comment on the bidding, but said the company still is on target to complete the sale by the end of this year or early next year.
Ford bought Jaguar for $2.5 billion in 1989 and Land Rover for $2.7 billion in 2000, joining them with Aston Martin and Volvo to form its Premier Automotive Group. Ford has not said how much it wants for the combined units, but analysts have estimated they could be worth about $1.5 billion (1.01 billion EUR).
Earlier this year Ford completed the sale of its controlling stake in Aston Martin for $931 million in cash and preferred stock.
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