Tubes Investments of India Ltd (TII) will be acquiring a controlling stake of up to 70 per cent in Hyderabad-based Cellestial E-Mobility Pvt Ltd, a start-up engaged in the design and manufacture of electric tractors, for a sum of ₹161 crore in an all-cash deal as the Murugappa Group company accelerates its electric mobility growth plans after its announcement on entry into electric three-wheelers.
TII will buy 141,677 equity shares of Cellestial at ₹11,356 per share (face value of ₹10 per share) through a combination of primary and secondary purchases.
On Monday, TII signed a share subscription and purchase agreement with Cellestial, its founders and other existing shareholders. The acquisition is expected to be completed before March 15, 2022, subject to shareholders approval and other conditions, said a company statement.
Focus on clean mobility
Tube Investments has been exploring new growth opportunities within clean mobility. As part of this, the company recently embarked on an electric three-wheeler initiative. The company is now proposing to form a new 100% subsidiary to focus on clean mobility. This new subsidiary will consolidate the electric three-wheeler venture and other EV-related ventures.
The company will be infusing initial capital to the extent of ₹350 crore into the new subsidiary for clean mobility through a combination of equity, preference and debt instruments.
“The formation of a separate subsidiary and acquisition of a controlling stake in Cellestial will enable the company to bring required focus to the emerging growth opportunities in electric vehicles. These new EV products along with the existing product portfolio of bicycles and e-bicycles will further strengthen the company’s efforts towards climate change and sustainability,” said Arun Murugappan, Chairman of the company.
Cellestial is engaged in the design and manufacture of e-tractors. The electric tractors developed by Cellestial with swappable battery options offer a lower total cost of ownership compared to current IC tractors. Besides, these e-tractors will also result in lower CO2 emissions, promote green farming, and will take a step towards a circular economy, it said.