Ather Converts Preference Shares To Equity, Likely To Float IPO In April

SUMMARY

Ather Energy’s board passed a resolution on March 8 to convert 1.73 Lakh outstanding CCPS to 24 Cr fully paid up equity shares

The EV major is likely to float its IPO in April, becoming the second company after Ola Electric to do so

As per its DRHP, Ather’s public issue will comprise a fresh issuance of shares worth INR 3,100 Cr and an OFS of up to 2.2 Cr shares

Going full throttle on its highly-anticipated initial public offering (IPO), electric two-wheeler maker Ather Energy has converted its outstanding compulsory convertible preference shares (CCPS) into equity shares.

As per regulatory filings accessed by Inc42, the company’s board passed a resolution on March 8 to convert 1.73 Lakh outstanding CCPS into 24 Cr fully paid up equity shares.

The equity shares, having a face value of INR 1 each, will rank pari-passu with the existing equity shares of the company.

The resultant equity shares will be allotted to shareholders including Hero MotoCorp Limited, Internet Fund III, Caladium Investment Pte Ltd, Innoven Capital India Fund, among others.

It is pertinent to note that SEBI regulations require all CCPS to be converted into equity shares before filing the red herring prospectus (RHP) for an IPO.

The move comes two months after the markets regulator greenlit Ather’s draft red herring prospectus (DRHP) for INR 3,100 Cr+ IPO. The EV company is expected to float its IPO by April, PTI reported, citing merchant banking sources.

The proposed public issue will comprise a fresh issuance of shares worth INR 3,100 Cr and an offer for sale (OFS) of up to 2.2 Cr shares.

Tiger Global, Caladium Investments, National Investment and Infrastructure Fund (NIIF), Binny Bansal’s 3 State Ventures, and cofounders Tarun Mehta and Swapnil Jain will offload their stakes via the OFS. However, Ather’s biggest shareholder, auto giant Hero MotoCorp with a 37.2% stake, will not participate in the OFS component.

Ather was reportedly targeting a valuation of around $2.5 Bn for its IPO. Ather plans to use the fresh proceeds from the public issue to shore up R&D, marketing initiatives, infrastructure, production initiative and general corporate purposes.

As per its DRHP, Ather plans to raise INR 620 Cr through a pre-IPO placement.

Ather’s public listing, when it transpires, will be the second by an electric mobility company in the country after Ola Electric. The Bhavish Aggarwal-led company made its public market debut in August last year. Its 6,145 Cr+ IPO was one of the largest in 2024.

Greaves Electric Mobility, which sells its escooters under the Ampere brand, is also preparing to knock at the doors of Dalal Street. The EV maker filed its draft red herring prospectus (DRHP) with SEBI for INR 1,000 Cr+ IPO in December 2024.

Meanwhile, Hyderabad-based electric vehicle maker Pure EV has converted into a public company ahead of its potential IPO this year.