Ola Electric raises $100M long term debt from Bank of Baroda

ola electric

Ola Electric has raised a 10-year long debt of $100 million from Bank of Baroda. The deal is said to be one of the largest long-term debt financing agreements in the Indian EV industry. 

Ola in December 2020 had announced that it would be investing Rs 2,400 crore to set up the first phase of the factory.

According to Ola Electric, the proceeds will be deployed towards the funding and financial closure of the first phase of the development of the manufacturing factory of its electric two-wheelers.

“Today’s agreement for long-term debt financing between Ola and Bank of Baroda signals the confidence of the institutional lenders in our plans to build the world’s largest two-wheeler factory in record time. We are committed to accelerating the transition to sustainable mobility and manufacture made in India EVs for the world, and we are happy that Bank of Baroda has joined us in our journey,” said Bhavish Aggarwal, Chairman, and Group CEO, Ola.

The Ola Futurefactory is coming up on a 500-acre site in Tamil Nadu, India claiming to have a capacity of manufacturing 10 million electric vehicles annually. The first phase of Ola Futurefactory is near completion, following which the company will commence production trials. 

The Ola Scooter will be manufactured at the Ola Futurefactory, which will also serve as the global EV hub for Ola for its range of scooters and other two-wheelers.

“The government has brought in several policies to incentivize make-in-India and to enable India to become a global EV leader. Ola is leading from the front, and we are delighted to partner with them for their EV business. The Ola Future factory will put India on the global EV map, and we are proud to be associated with them”, said Sanjiv Chadha, Managing Director, and CEO, Bank of Baroda.

Ola Electric is the first startup to turn into a unicorn in the electric vehicle space. Backed by the largest fundraise of $250 million by Softbank in 2019, the company was valued at $1 billion taking it into the league of Unicorns.  

Ola Electric entered into the two-wheelers space with the acquisition of Amsterdam-based electric scooter manufacturer Etergo in May 2020. The company aims to be the world’s largest two-wheeler factory.

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