Tata Motors in talks to sell minority stake in EV division

23 Feb 2023 , 12:28 PM

According to several people familiar with the ongoing negotiations, Tata Motors has begun discussions with sovereign wealth funds and private equity investors such as the UAE’s Abu Dhabi Investment Authority (ADIA) and Mubadala Investment Company, the Saudi Arabia-based Public Investment Fund (PIF), Singapore’s Temasek Holdings, as well as KKR and General Atlantic, to sell a significant minority stake in its EV division.

According to these sources, Tata Motors intends to raise up to $1 billion through the equity sale, with the majority of the proceeds going towards repaying some of its outstanding debt.

A small portion of the funds will be invested in the EV business as primary equity. According to a person familiar with the discussions, it is seeking a valuation of close to $10.5 billion, a 15% premium to the previous round, which valued the EV arm at $9.1 billion.

The latest round of funding comes at a time when the company is on track to fall short of its goal of becoming a zero net-debt company on a consolidated basis by FY24.

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