TPG Rise Climate and ADQ Invest in Tata Motors New EV Company

Posted on 10/12/2021


Tata Motors formed a new electric vehicles (EV) subsidiary that will require over Rs 16,000 crore of investment in the next five years. TPG Rise Climate, a fund managed by TPG Capital, and Abu Dhabi Developmental Holding Company PJSC (ADQ) will be investing Rs 7,500 crore (around US$ 1 billion) for an 11% to 15% stake in this subsidiary. This is not spinning out the EV business, but forming a new company. Over the next five years, the EV company will create a portfolio of 10 EVs, according to a Tata Motors statement.

Tata Motors disclosed that the EV unit company will be issuing 50 million A1 compulsorily convertible preference shares and 25 million A2 compulsorily convertible preference shares to TPG Rise and it co-investors for an aggregate of Rs 7,500 crore.

Advisors
Morgan Stanley and JP Morgan were the joint financial advisors to Tata Motors on the deal, while BofA Securities India was representing TPG Rise Climate for this transaction.

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