Tata Motors is negotiating a share sale in the EV industry to raise $1 billion

According to sources cited by the Economic Times on Thursday, Tata Motors has started discussions with sovereign wealth funds and private equity firms about selling a stake in its electric vehicle division in order to raise up to $1 billion.

According to the newspaper story, the corporation intends to sell a sizeable minority stake and is targeting a valuation of roughly $10.5 billion.

Abu Dhabi Investment Authority (ADIA) and Mubadala Investment Company, based in the United Arab Emirates; the Public Investment Group, with headquarters in Saudi Arabia; Temasek Holdings, based in Singapore; and KKR and General Atlantic are among the funds and investors.

A request for comment from Reuters was not immediately answered by Tata Motors or some of the businesses.

Temasek stated that it does not comment on “market rumours and speculation,” while KKR refused to do so.

According to the article, Tata Motors intends to use the majority of the revenues to pay off some of its existing debt and inject a minor amount as primary stock in the EV industry.

Uber Technologies announced earlier this week that it intends to introduce 25,000 electric vehicles over the course of three years in the nation and that it will purchase cars from Tata Motors, India’s largest EV manufacturer.

Tata Motors has revealed its intentions to increase the pricing points and add more models to its electric car lineup.

With only 1% of the approximately 3 million cars sold in India each year being electric versions, the country’s auto market is minuscule in comparison to its population. By 2030, the government plans to increase this to 30%.

Tata Motors committed to investing more than $2 billion in its EV business over the course of five years when it raised $1 billion from TPG and Abu Dhabi state private equity firm ADQ in 2021 for its EV operation at a $9 billion valuation.