A new has been signed between Mahindra & Mahindra (M&M), an enterprise in the automotive, farm, and services sectors, and the India-Japan Fund (IJF).
As per the agreement, IJF has committed an investment of Rs. 400 Crore in Mahindra Last Mile Mobility Limited (MLMML), a company managing M&M's last-mile mobility business, encompassing its range of three and four-wheel vehicles. The agreement will see IJF add its wealth to the business at a valuation of up to Rs. 6600 Crore.
The IJF, a Rs. 4900 Crore fund with Japan Bank of International Cooperation and the Government of India as primary investors, focuses on environmental sustainability and low-carbon emission strategies.
It also facilitates investments by Japanese companies into India and fosters collaboration between Indian and Japanese enterprises. MLMML will be the inaugural venture for the IJF investment pool, set up as recently as August 2023.
The investment by IJF will result in an ownership stake ranging between 6.06% and 8.25% in MLMML, depending on the final valuation. The IJF will join the International Finance Corporation (IFC) as an investor, and the deep well of expertise from these esteemed backers will be harnessed to support the ongoing expansion of MLMML.
Dr. Anish Shah, Group CEO & MD, Mahindra Group, expressed his enthusiasm over the alliance stating, "We are delighted to have NIIF as a partner in our last mile mobility journey through IJF."
"At Mahindra Group, we are committed to developing sustainable mobility solutions that help in accelerating the decarbonisation of the transport sector. This agreement with a prestigious investor like IJF moves us closer to our mission to be Planet Positive by 2040."
Krishna Kumar G, Partner, India Japan Fund, NIIF, echoed Dr. Shah's sentiment saying, "We are excited to announce NIIF’s partnership with Mahindra Group by way of IJF’s investment in Mahindra’s last mile mobility business, reflecting the fund’s commitment to invest in low carbon emission strategy opportunities."
"Working alongside our partners JBIC, we believe that our investment in MLMML should yield transformative results in the last-mile mobility domain, driving economic growth, generating employment, and ensuring environmental sustainability.”
Expressing Sir Rajesh Jejurikar, Executive Director and CEO, Auto & Farm Sectors, Mahindra & Mahindra, commented, "MLMML is a pioneer in revolutionising the electric three-wheeler growth in India, enabling customer prosperity including employment generation and providing sustainable last-mile connectivity."
"It is a market leader in this segment, and was awarded the first automotive Production Linked Incentive (PLI) certificate. We welcome IJF in this journey as we work towards growing the market at scale through technology and sustainable solutions."