Wednesday, 12 June 2024
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IFC Provides Rs 600 Billion to M&M’s New Last-Mile Mobility Subsidiary

To scale up more affordable electric three-wheelers and small commercial vehicles (SCVs), the International Finance Corporation, a member of the World Bank Group, will invest Rs 600 crores at a valuation of up to Rs 6,020 crores in the newly incorporated Last Mile Mobility Company (NewCo), which will be launched by Mahindra & Mahindra.

The company will transfer to NewCo the assets and/or business related to its Last Mile Mobility Business.

M&M’s New Last-Mile Mobility

After NewCo is incorporated, the Company will decide on the specifics of the Asset/Business Transfer, which will then be made public.

IFC has never before invested in an electric vehicle producer in the nation or electric three-wheelers abroad. The investment would be made in one or more tranches as mandatory convertible securities with a maximum value of Rs 6,020 crores.

  • IFC will invest Rs 600 crores in the newly incorporated Last Mile Mobility Company (NewCo).
  • IFC has never before invested in an electric vehicle producer in the nation.
  • IFC will own between 9.97 percent and 13.64 percent of NewCo

IFC will own between 9.97 percent and 13.64 percent of NewCo as a result of its investment of Rs 600 crores. The transaction must receive the required approvals.

The final mile mobility segment, which includes three-wheelers (Alfa, Treo, and Zor) and four-wheelers SCV, will be housed by NewCo. The funding from IFC will assist NewCo in the scalability of electric mobility in last-mile connections.

IFC is the perfect partner for us because of its emphasis on sustainability and increasing prosperity. We will advance in our commitment to being “Planet Positive” by 2040 once the last-mile transportation business is electrified at scale.

In February, M&M Auto reported total sales of 58,801 units, which fell short of Nomura’s prediction of 64,600 units. Sales of 3-wheelers overall (including EVs) increased 40% year over year to 5,350 units in February.

Since the release of the IFC investment report, M&M stock has slightly increased, and it is currently trading close to its flat line. The price of M&M shares has dropped by almost 8% this month and by more than 6% overall.

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