In a significant development, the Board of Directors of Hero MotoCorp granted approval for an investment of up to ₹550 crore (Rupees five hundred fifty crore) in the Rights issue of Ather Energy Private Limited. This investment is contingent upon the execution of definitive documents and the fulfilment of customary conditions inherent to transactions of this nature.
It’s crucial to note that this transaction falls under the category of a subscription in the Rights issue of the Associate Company, making it a related party transaction. However, it is imperative to clarify that this is not an acquisition. Hero MotoCorp Ltd. is subscribing to shares in Ather Energy’s Rights issue. Importantly, Hero MotoCorp is already an existing shareholder in Ather.
One notable aspect of this investment is that no government or regulatory approvals are required, streamlining the process. The anticipated timeframe for the completion of this investment is set for September 30, 2023.
Ather Energy, an established Associate company of Hero MotoCorp Limited (HMCL), operates within the electric two-wheeler industry, encompassing the design, manufacture, sale, and servicing of electric two-wheelers. Additionally, Ather has ventured into the charging infrastructure domain, playing a role in the storage, distribution, and management of electric power, including energy stored in batteries, along with other related services.
This strategic investment underscores Hero MotoCorp’s commitment to the electric mobility sector and further solidifies its partnership with Ather Energy, a key player in the electric two-wheeler and sustainable energy segments. It’s essential to emphasize that this move aligns with Hero MotoCorp’s active involvement in the evolution of India’s electric mobility landscape.
Furthermore, it’s worth noting that the transaction, being a subscription in the Rights issue of the Associate Company, is conducted on an arm’s length basis, and no members of the promoter group or group companies have any vested interest in the entity in which this proposed investment/subscription is taking place.
This investment signals Hero MotoCorp’s dedication to fostering innovation and sustainability within the Indian electric mobility sector, marking a pivotal moment in the company’s ongoing journey towards a cleaner and more environmentally conscious future.