Temasek to invest Rs1200 crore into Mahindra Electric Automobile at $9.74 billion valuation

economictimes.indiatimes.com:

Mahindra & Mahindra and Temasek, the Singapore-headquartered global investment firm, have executed a binding agreement for the latter to invest Rs1200 crores into MEAL (Mahindra Electric Automobile Limited), the four-wheeler (4W) passenger electric vehicles company, Mahindra and Mahindra said in a filing to the stock exchanges. Temasek will invest Rs1200 crores in the form of Compulsorily Convertible Preference Shares (CCPS) at a valuation of up to Rs 80,580 ($9.74 billion) crores resulting in Temasek’s ownership of a 1.49% to 2.97% stake in MEAL. ET had reported on the company’s fund-raising plans in its July 10 edition.

The valuation makes MEAL the most valuable EV company in India. In 2021, Tata Motors raised $1 billion from TPG and Abu Dhabi state holding company ADQ for its EV unit at a $9 billion valuation. Temasek will join British International Investments (BII) as an investor in MEAL.

With this investment, Mahindra’s EV subsidiary’s valuation goes up by 15% from up to Rs. 70,070 crores to up to Rs. 80,580 crores.

“The breadth of global experience of these marquee investors will be valuable for MEAL. The amount invested is consistent with the Mahindra Group’s plan to minimize dilution,” the company said in the statement. The latest round of investment is part of the envisaged business plan of investing Rs10,000 crores cumulatively in MEAL by FY27.

BII invested Rs1925 crore to MEAL. “We are extremely delighted to have Temasek as a partner in our electric SUV journey. Globally known for their strong governance, Temasek’s investment is a step forward, as we execute our strategy towards future leadership in electric SUVs.