Indian automaker Tata Motors has raised about $1 billion from private equity firm TPG’s Rise Climate Fund and Abu Dhabi state holding company ADQ to expand its electric vehicle business.
Tata Motors will form a separate electric vehicle unit in which TPG and ADQ will hold between 11 percent and 15 percent, valuing the new entity at about $9.1 billion, Reuters reported.
Tata Motors will use the funds to invest in electric vehicles (EVs), dedicated battery electric vehicle platforms, charging infrastructure and battery technologies, Tata Motors, owner of luxury car brand Jaguar Land Rover, said.
This is the first major fundraising by an Indian carmaker to push clean mobility when global automakers such as General Motors, Volkswagen and Toyota Motor are spending tens of billions of dollars to speed up EV adoption.
It also comes as U.S. electric carmaker Tesla is preparing to launch its cars in India and has been lobbying the government to lower import duties on EVs.
Investments in EVs globally by 2025 could total $330 billion, consulting firm AlixPartners said in June, adding that it expects EV sales to increase to about a quarter of total global vehicle sales by 2030 from about 2 percent today.
Chinese companies have been leading the global EV push and automakers such as Li Auto, Nio and Xpeng have raised billions of dollars through stock listings in the United States.
Tata Motors, which is the largest seller of EVs in India, has previously said it plans to launch 10 new EVs by 2025 as well as invest in setting up charging infrastructure across the country.