British impact investor BII to invest ₹1,925 crore in new EV Co of M&M
The Hindu
Investment comes at a valuation of over ₹70,000 crore
In a major boost for Electric Vehicles (EV) manufacturing in India, British International Investment (BII), the U.K.’s Development Finance Institution and impact investor has entered into a binding agreement with Mahindra & Mahindra Ltd (M&M) to invest up to ₹1,925 crore into a wholly-owned subsidiary of M&M that will be newly incorporated (EV Co).
M&M will also invest ₹1,925 crore in this new venture.
BII’s investment will come in the form of compulsory convertible instruments at a valuation of up to ₹70,070 crore, resulting in 2.75% to 4.76% ownership for BII in the EV Co. which will focus on four-wheel (4W) passenger electric vehicles.
In early October 2021, Tata Motors Ltd (TML) announced that TPG Rise Climate along with its co-investor ADQ would invest ₹7,500 crore [$1 billion] in a new subsidiary — to soon be incorporated — to focus exclusively on electric vehicles (EVs) at a then valuation of up to $9.1 billion. TML has already announced a $2 billion investment plan for its EV subsidiary.
M&M said in a late-night statement said that the total capital infusion for the EV Co. is likely to be around ₹8,000 crore / $1 billion between FY 24 and FY 27 for the planned product portfolio,
Mahindra which was the pioneer of EV manufacturing in the country following its acquisition of Reva, the first EV company in India, had in recent years lost out in the race to Tata Motors which has achieved significant market share in the EV passenger segment.
Mahindra now wants to catch up with this investment.