Home/ Markets / Stock Markets/  Greaves Cotton shares rally as Saudi Arabia's Abdul Latif Jameel to invest in EV arm

Shares of Greaves Cotton surged about 8% on the BSE in Thursday's early deals after the company announced that Saudi Arabian firm Abdul Latif Jameel International will invest in the firm's electric vehicle (EV) arm, Greaves Electric Mobility (GEM).

“Greaves Electric Mobility announces a strategic investment by Abdul Latif Jameel, an independent, family-owned, diversified global investor and operator. Abdul Latif Jameel has committed total investment of US$ 220 million," Greaves Cotton informed in an exchange filing.

The company has claimed it be one of the largest single tranche growth capital investments in the Indian E2W / E3W sector. The initial investment will be of $ 150 million ( 1,160 crore) for a 35.8% stake on a fully diluted basis in Greaves Electric Mobility. Post money equity value for the EV subsidiary will be of $419 million ( 3,238 crore).

“The proceeds from this investment will be used to develop new products, associated technologies, brand awareness, aiming to transform the Company into a leading global EV manufacturer. The investment aims to support Greaves Electric Mobility as it transitions into the next phase of growth," Greaves Cotton added.

By offering cleaner mobility options, Greaves Electric Mobility and Abdul Latif Jameel will assist India in achieving its objective of reducing carbon emissions by one billion tons by 2030. 

The board of directors of respective companies have approved the transaction which is subject to legal, regulatory, contractual and customary approvals and the completion of agreed conditions set out in the agreements.

“This investment from Abdul Latif Jameel is an important step towards making clean, sustainable and affordable mobility solutions truly accessible to a much wider customer base. With this investment, we will continue to deliver tangible value to our customers and shareholders alike," said Nagesh Basavanhalli, MD and Group CEO, Greaves Cotton.

Greaves Electric Mobility manufactures electric two-wheelers under the brand name of Ampere Vehicles and three-wheeler vehicles (E-Auto and E-Rickshaw) under the brands Ele and Teja.

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Updated: 02 Jun 2022, 11:59 AM IST
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