Hero MotoCorp Buys More Stake In Ather Energy Ahead Of Likely IPO

Hero MotoCorp Ltd. has acquired additional stake in Ather Energy Pvt., ahead of a likely initial public offering of the electric scooter-maker.

India’s largest two-wheeler maker has picked up an additional 2.2% stake in the Bengaluru-based electric mobility startup in a secondary transaction valued at Rs 125 crore, according to an exchange filing issued on Thursday.

In a secondary stake sale, the money goes to the selling shareholder and not the company. The purchase is likely to be completed by July 31. Ather Energy refused to comment on the valuation at which the deal was done.

The transaction comes nearly six months after Hero MotoCorp acquired a 3% stake in Ather Energy for Rs 140 crore, raising its overall shareholding to 39.7%.

The transaction also comes when Ather Energy is reportedly in talks to raise funds from an initial public offering. According to people familiar with the matter, the company plans to file for an IPO as early as this month to raise about $400 million at a valuation of $2 billion.

According to Bloomberg, HSBC Holdings Plc., Nomura Holdings Inc. and JPMorgan Chase & Co. are arrangers for the Ather Energy IPO. Local banks, including JM Financial Ltd. and Axis Bank Ltd., could also be involved as book-running lead managers.

Founded by IIT Madras graduates Tarun Mehta and Swapnil Jain in 2013, Ather Energy is involved in the business of electric two-wheelers as well as charging infrastructure.

Hero’s maiden electric scooter, Vida V1, is compatible with Ather Energy’s charging network. The company, at present, retails three electric scooters—the Ather 450X, 450S and Rizta.