Temasek to invest Rs 1,200 crore in Mahindra Electric via preference shares

Mahindra Electric Automobile Ltd (MEAL), Mahindra & Mahindra's electric vehicle arm, on Thursday, announced that investment firm Temasek would invest Rs 1,200 crore in the company in compulsorily convertible preference shares.

With this, the company's valuation will rise 15 per cent from Rs 70,070 crore to Rs 80,580 crore.

"The securities subscription agreement and shareholders' agreement inter alia provide for investment by Temasek of Rs 1,200 crore in compulsorily convertible preference shares of MEAL, in one or more tranches, in accordance with the terms and conditions as stipulated in the aforesaid agreement, valuing MEAL upto Rs 80,580 crores. The above investment also envisages Temasek having a nominal shareholding of 100 Equity Shares in MEAL," the company said in a regulatory filing.

After the infusion, Temasek will have a shareholding in MEAL in the range of 1.49 per cent to 2.97 per cent of the paid-up share capital on a fully diluted basis. Temasek will join British International Investments (BII) as an investor in MEAL. In July last year, M&M had announced an investment of up to Rs 1,925 crore by BII in MEAL.

Anish Shah, managing director (MD) and chief executive officer (CEO) of Mahindra & Mahindra Ltd., said, "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."

"By having Temasek as an investor, we have strengthened our global strategic partnerships and are targeting 20 per cent to 30 per cent of Mahindra SUVs sales from electric vehicles by 2027," added Rajesh Jejurikar, executive director and CEO, Auto & Farm Sectors, Mahindra & Mahindra.

Singapore-headquartered Temasek Holdings is a global investment company with a net portfolio value of $287 billion as of March 31, 2023.