The Competition Commission of India (CCI) has given the nod to Hyundai and Kia’s investment in Ola and Ola Electric. Post the approval, the companies have collectively received Rs 2,244 crore from the South Korean automakers.
According to regulatory filings with the Ministry of Corporate Affairs (MCA), Hyundai has picked up 8,04,592 shares worth Rs 1,709.75 crore while Kia got 2,01,148 shares for Rs 427.43 crore in the Series J round of fundraising. Each share was priced at Rs 21,250.
Apart from ANI Technologies that controls Ola, Ola Electric Mobility Private Ltd. has received Rs 106.8 crore in Series A round from Hyundai and Kia. While Hyundai Motor invested Rs 84.5 crore, Kia Motors poured Rs 21.3 crore. Each share was priced at Rs 14,61,523.
The CCI had frowned upon the transaction as it was of the view that the impact of car companies investing in cab-hailing apps might create a monopolistic situation for one carmaker in the market. However, the anti-competition watchdog permitted the transaction after Ola furnished its competitive landscape.
Entrackr had exclusively reported about Hyundai looking to invest up to $300 million in Ola in March this year. So far, Ola has raised about $457.7 million in the Series J round. Hyundai and Kia are looking to push their electric offerings into Ola’s fleet and related infrastructure.
Since the second half of last year, Ola has started preparing for a public listing in India and this reflected in its financials during FY19. The company recorded a significant spike of 37.7% in operating revenue to Rs 2,543.63 crore in FY19.
Even as total expenses for the SoftBank-backed firm grew by around Rs 319 crore to Rs 5,385.81 crore in FY19 from Rs 5,066.6 crore in FY18, Ola harnessed its assets to generate revenues efficiently.
The total losses for the firm witnessed a decline of around 8.8 %, amounting to Rs 2,593 crore in FY19.