Mahindra & Mahindra Ltd. and British International Investment Plc (BII), a division of the UK government, have changed the terms of BII’s funding tranche for Mahindra Electric Automobile Ltd (MEAL), the Indian automaker’s electric car division, from Rs 725 crore to Rs 650 crore. By March 31st, the investment will be completed.
M&M and BII agreed to reevaluate the funding requirement by December 31 and extended the schedule for the last tranche in May. M&M stated in an exchange filing that it and BII had reached a mutual agreement after a collaborative assessment of the finance requirements for MEAL that the final tranche of BII Group’s investment would be Rs 650 Crores, to be finished by March 31, 2025.
With this, BII will now have invested a total of Rs 1,850 crore in MEAL in two tranches, and it will own a share in MEAL that ranges from 2.6-4.6%. Previously, a total of approximately Rs 1,925 crore was projected to be invested in MEAL. M&M stated that MEAL’s overarching business plan will not be impacted by the funding shift.
In the first tranche, BII invested Rs 1,200 crore in MEAL. In addition to BII, Mahindra’s electric car division is also owned by Temasek, an investment firm based in Singapore. Temasek declared in 2023 that it will invest Rs 1,200 crore in MEAL for a 1.5–3% share in the business.
M&M’s bigger plan to become a major force in the EV market includes the Born Electric portfolio. The business had previously stated that it expected 20–30% of vehicles to be electric by 2027. The board of M&M also authorized an investment of Rs 12,000 crore for the next three years in its electric company MEAL at the beginning of this fiscal year.
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