The company plans to sell a significant minority stake, the newspaper report added, eyeing a valuation of approximately $10.5 billion.
The funds and investors include the UAE-based Abu Dhabi Investment Authority (ADIA) and Mubadala Investment Company, the Saudi Arabia-headquartered Public Investment Fund, Singapore’s Temasek Holdings, and KKR and General Atlantic.
Tata Motors and some of the companies didn’t immediately respond to Reuters’ request for comment.
KKR declined to comment while Temasek said it does not comment on “market speculation and rumors”.
Tata Motors plans to use the bulk of the proceeds to retire a part of its outstanding debt and infuse a small portion as primary equity in the EV business, said the report.
Earlier this week, Uber Technologies said it plans to introduce 25,000 EVs over three years in the country and will purchase vehicles from Tata Motors, India’s biggest electric car maker.
Tata Motors has outlined plans to expand its electric vehicle portfolio with new models and higher price points.
India’s car market is tiny compared to its population, with electric models making up just 1% of the total car sales of about 3 million a year. The government wants to increase this to 30% by 2030.
In 2021, Tata Motors raised $1 billion from TPG and Abu Dhabi state holding company ADQ for its EV unit at a $9 billion valuation, pledging to invest over $2 billion in its EV business over five years.