Tata Motors has started talks with sovereign wealth funds and private equity investors to raise up to $1 billion (approximately Rs 8,277 crore) by selling a stake in its electric vehicle (EV) business, The Economic Times reported on Thursday, citing sources.
The company plans to sell a large minority stake, valuing it at about $10.5 billion (approximately Rs 86,913 crore), the newspaper added. These funds and investors include the UAE-based Abu Dhabi Investment Authority (ADIA) and Mubadala Investment Company, Saudi Arabia-based Public Investment Fund, Singapore’s Temasek Holdings, as well as KKR and General Atlantic.
Tata Motors and some companies did not immediately respond to Reuters’ request for comment.
KKR declined to comment, while Temasek said it did not comment on “market speculation and rumours”. Tata Motors plans to use most of the proceeds to repay some of its outstanding debt and inject a smaller portion as a major equity stake in its electric vehicle business, the report said.
Earlier this week, Uber Technologies said it plans to launch 25,000 electric vehicles in India within three years and will buy vehicles from Tata Motors, India’s largest electric car maker.
Tata Motors has outlined plans to expand its electric vehicle portfolio with new models and higher price points.
India’s car market is small compared to its population, with electric models accounting for only 1% of total vehicle sales of about 3 million vehicles annually. The Indian government hopes to increase this proportion to 30% by 2030.
In 2021, Tata Motors raised $1 billion for its electric vehicle unit from TPG and Abu Dhabi state-owned holding company ADQ, valuing it at $9 billion (approximately Rs. 74,507 crore), and committed to investing more than $2 billion (approximately Rs. 16,557 crore) in its electric vehicle business within five years.
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