Greaves Cotton jumped 7.20% to Rs 173.40 after the company announced a strategic investment by Abdul Latif Jameel in its electric vehicle (EV) arm Greaves Electric Mobility.

Greaves Electric Mobility (GEMPL), Greaves Cotton and Abdul Latif Jameel International DMCC (investor) have signed a share subscription agreement and shareholders’ agreement for an investor proposed investment in GEMPL of $150 million for subscription by the investor at 68, 35,450 capital shares of GEMPL will be issued and allocated to the investor on a preferred allotment by private placement resulting in a 35.80% equity interest on a fully diluted basis in GEMPL.

GEMPL will also have the right (but not the obligation) to require the investor to make additional investments (Optional Additional Investments), in one or more tranches, in GEMPL up to $70 million through of a primary subscription within 12 months of the completion of the proposed investment.

Currently, GEMPL is a wholly owned subsidiary of Greaves Cotton. Pursuant to completion of the proposed investment, the Company will hold a 61.38% equity interest on a fully diluted basis in GEMPL and following completion of the proposed investment, GEMPL will continue to be a subsidiary of the Company.

In addition, following completion of the final tranche of optional additional investments, GEMPL will continue to be a subsidiary of the Company.

GEMPL, incorporated in 2008, is principally engaged in the development, manufacture and marketing of fully assembled electric two-wheelers and electric three-wheelers for personal mobility, industrial applications and material transportation. It manufactures electric two-wheelers under the Ampere Vehicles brand and three-wheeled vehicles (E-Auto and E-Rickshaw) under the Ele and Teja brands.

Abdul Latif Jameel is an independent, family-owned and diversified global investor and operator. The company draws on Abdul Latif Jameel’s extensive global experience in the automotive market as a leading independent distributor of Toyota products for over 65 years.

The Jameel family, which owns Abdul Latif Jameel, is also a start-up investor and the third largest shareholder in US electric vehicle maker Rivian. The family also invests in other cutting-edge innovators such as US aerospace company Joby Aviation, through its global investment arm JIMCO.

Nagesh Basavanhalli, MD and Group CEO, Greaves Cotton, said: This investment by Abdul Latif Jameel is an important step in making clean, sustainable and affordable mobility solutions truly accessible to a much wider customer base.

Through hard work, innovation and seizing the opportunities presented by changing personal mobility preferences, we have become one of the fastest growing electric vehicle brands in India. With this investment, we will continue to deliver tangible value to our customers and shareholders.

Greaves Cotton is a diversified multi-product, multi-site engineering company.

The company’s consolidated net profit increased by 22.42% to Rs 16.71 crore on a 19.30% increase in sales to Rs 620.82 crore in Q4 FY22 compared to Q4 FY21.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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