TVS Motors acquires 48% stake in Narain Karthikeyan's two-wheeler startup DriveX

Leading two-wheelers manufacturing firm TVS Motor Company on 24 August announced an acquisition of 48 percent stake in Narain Karthikeyan’s two-wheeler startup DriveX for ₹85.4 crores.

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Karthikeyan’s firm Nkars Mobility Millennial Solutions Private Limited (NMMSPL)operates a digital platform ‘DriveX’ which provides two-wheelers to customers on a subscription model for a flexible tenure and on a purchase model, along with certain ancillary services.

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In FY 2020-21, NMMSPL had a turnover of ₹47.98 lakhs. This investment in DriveX by TVS Motors is aimed at enabling innovative solutions to lead this transformation, the latter said in a stock filing report.

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According to the agreement, "TVS Motor Company Limited (TVSM) considers NMMSPL to be a strong partner to grow its pre-owned two-wheeler vehicle business. To this end, subject to completion of the conditions precedent to closing, TVSM shall obtain 48.27% stake in NMMSPL through subscription of shares issued by way of preferential allotment and through purchase of shares from certain existing shareholders of NMMSPL." The indicative time period for completion of the acquisition is 30 November 2022.

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“The pre-owned two-wheeler market is largely unorganized today. It is delightful to see what DriveX has been able to create and deliver in short time. Narain and his team have built a unique platform that can scale up quickly. DriveX has a vision to bring a change in this segment by building trust, assurance, and transparency through end-to-end, high-quality products and customer experience through innovative solutions. We are confident of DriveX ability to deliver on this vision," TVS Motor Company's MD Sudarshan Venu said while announcing the investment. 

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Incorporated in April 2020, DriveX started off as a two-wheeler subscription platform, providing affordable and flexible mobility solutions and has expanded to five cities in a short span of time.

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“The pre-owned twowheeler vehicle market is changing rapidly today. DriveX is a digital first business, serving all brands with unique analytics-led capabilities across the value chains. We have also been successful at launching new business models, including the subscription model in the pre-owned two-wheeler segment," DriveX founder Narain Karthikeyan said.