Temasek Holdings to invest Rs 1,200 crore in Mahindra Electric, acquire up to 3% stake

economictimes.indiatimes.com:

Temasek Holdings and Mahindra & Mahindra have executed a binding agreement whereby the former will invest Rs 1,200 crore in the latter’s subsidiary Mahindra Electric Automobile Ltd. Temasek will invest the money by subscribing to compulsorily convertible preference shares at a valuation of Rs 80,580 crore, M&M said in a release. This investment will result in Temasek holding a 1.49-2.97% stake in Mahindra Electric Automobile.

The Singapore-headquartered investment firm will invest Rs 1,200 crore in one or more tranches, M&M said. Upon subscribing to compulsorily convertible preference shares, Temasek will get certain rights as a shareholder, such as governance and affirmative voting rights, pre-emptive rights to participate in future funding rounds and minority protection rights, as per the agreement. The investment by Temasek is part of M&M’s envisaged business plan of bringing in Rs 10,000 crore worth of investment in the electric vehicle manufacturing arm by FY27.

Temasek’s fund infusion will help Mahindra Electric to onboard more marquee investors to deliver sustainable value over the long term, besides strengthening the group’s global strategic partnerships. “By having Temasek as an investor, we have strengthened our global strategic partnerships and are targeting 20-30% of Mahindra SUVs sales from electric vehicles by 2030,” said Rajesh Jejurikar, executive director and CEO, auto and farm sectors, at M&M. Temasek will join British International Investments (BII) as an investor in Mahindra Electric.