Tata Motors may have to borrow significantly more than the estimated £1 billion asking price in order to secure the acquisition of Jaguar Land Rover from Ford.
Sources claimed yesterday that the Indian company may need around $3 billion (£1.5 billion) if the deal was to go through.
It is understood the company has asked Citigroup and JP Morgan, its financial advisers on the deal, to organise the loan, which could involve as many as eight or nine different banks around the world.
However, there are concerns in India that the company may be overstretching itself in its stated intention of securing the two iconic brands.
Tata Motors' five-year credit default swaps have more than doubled and its share price fallen 12 per cent since January when it was announced as preferred bidder by Ford in the race to acquire the two car companies.
Ashutosh Goel, an analyst at Mumbai-based Edelweiss Capital, was quoted as saying: "The market is not happy about the deal because there is no synergy in the short term and it's a burden on Tata's balance sheet."
To minimise the risk, the loan is likely a short term bridging arrangement with around a $1 billion possibly being used as working capital for Tata Motors.
The other banks involved in the arrangements are thought to be Chase, Bank of Tokyo and Mitsubishi UFJ, BNP Paribas, Calyon, ING Groep, Mizuko Financial Group, Standard Chartered and State Bank of India.
One of the major problems the company faces is down to the current financial environment which has forced up the cost of borrowing because of more expensive credit. The deal is likely to be concluded within the next couple of weeks.