Tata Motors Announces New EV Firm, To Raise Rs 7,551 Crore From TPG Rise Climate

The new EV firm, which will be a subsidiary of Tata Motors, will have a portfolio of 10 electric vehicles over the next five years.

New Delhi: Tata Motors today announced a new EV firm with a valuation of more than USD 9.1 billion (over Rs 68,750 crore). The automaker has also entered into an agreement with TPG Rise Climate, whereby the latter, along with its co-investor ADQ, will invest USD 1 billion (over Rs 7,551 crore) in compulsory convertible instruments to secure between 11 per cent and 15 per cent stake in the new EV firm.

The new EV firm, which will be a subsidiary of Tata Motors, will leverage all existing investments and capabilities of the automaker. It will channelise the future investments into electric vehicles, dedicated BEV (battery electric vehicle) platforms and advanced automotive technologies. Additionally, it will also catalyse investments in charging infrastructure and battery technologies.

The new EV firm will be incorporated afresh and have a portfolio of 10 electric vehicles over the next five years. It will also help in creation of a widespread charging infrastructure to facilitate rapid EV adoption in India, in association with Tata Power Ltd.

“I am delighted to have TPG Rise Climate join us in our journey to create a market-shaping electric passenger mobility business in India. We will continue to proactively invest in exciting products that delights customers while meticulously creating a synergistic ecosystem. We are excited and committed to play a leading role in the government’s vision to have 30 per cent electric vehicles penetration rate by 2030,” Tata Motors Chairman N Chandrasekaran said.

“We are excited to partner with Tata Motors on their mission to lead the electrification of passenger mobility in India. There is significant momentum around India’s EV movement, supported by the government’s vision and policies, as well as growing consumer demand for greener solutions. The investment aligns with TPG Rise Climate’s focus on decarbonized transport and builds on TPG’s long history in India,” TPG Rise Climate Managing Partner Jim Coulter said.

The first round of capital infusion into the new EV firm is expected to be completed by March 2022, while all the funds will be infused by end of 2022.