Ather Energy's board on Tuesday approved the allotment of 16.3 lakh equity shares and 79.4 lakh convertible warrants as part of the electric two-wheeler maker's ₹1,200-crore preferential fundraise. The company allotted 16.3 lakh fully paid-up shares to the India-Japan Fund, represented by the National Investment and Infrastructure Fund , at ₹1,230 apiece.
The investment is worth about ₹200 crore, according to an exchange filing. Hero MotoCorp, Ather's largest shareholder, was allotted 76.2 lakh convertible warrants at ₹1,260 each, representing an investment of nearly ₹1,000 crore if the warrants are fully converted into shares.
Ather co-founders Tarun Mehta and Swapnil Jain were allotted 1.59 lakh warrants each at the same price, amounting to about ₹20 crore each. The fundraise will therefore largely come from Hero MotoCorp, further increasing the two-wheeler major's ownership of Ather.
The India-Japan Fund's holding will rise to 5.87% from 5.60%. The holdings of Mehta and Jain, meanwhile, will each decline slightly to 4.73% from 4.80% on a fully diluted basis. The warrants do not turn into shares immediately. Under the terms of the issue, investors are required to pay 25% of the warrant price upfront, with the remaining 75% payable when they choose to convert the warrants into equity.
The warrants can be converted into shares in one or more tranches within 18 months of allotment. That means Hero MotoCorp's nearly ₹1,000-crore commitment will also be paid in stages, with the full amount coming into Ather if and when all the warrants are converted.
The new shares will be listed on the NSE and BSE after the required approvals. The warrants themselves will not be listed, though shares issued upon their conversion will eventually be listed on the exchanges. Ather Energy reported a net loss of ₹50.87 crore on revenue of ₹1,217 crore in its latest quarter.
The company's shares closed nearly 1% lower at ₹1,439.40 on the NSE on Tuesday.