Japanese investment conglomerate SoftBank has reduced its stake in Indian two-wheeler electric vehicle manufacturer Ola Electric to 11.7% after offloading 5.55 crore shares via open-market operations between January 6 and October 22. In addition to paring its direct equity ownership, the institutional investor also sold 1.12 crore rights entitlements under Ola Electric’s proposed ₹1,000 crore rights issue, according to regulatory disclosures reported by Inc42.
The share sale was executed through SoftBank’s dedicated investment vehicle, SVF II Ostrich (DE) LLC. Prior to the disposals, SoftBank held a 12.9% stake in the EV manufacturer, calculated against the company's expanded post-listing share capital. Following the transaction of 5.55 crore equity units, SoftBank's remaining holding stands at 54.15 crore shares.
Rights Entitlements Monetization
Alongside direct equity sales, SoftBank opted to monetize a significant portion of its rights issue participation rights. Under Ola Electric's two-for-25 rights offering—aimed at raising nearly ₹1,000 crore to pare down balance-sheet debt and finance capital expenditures—eligible shareholders holding equity on the October 13 record date were credited with tradable rights entitlements.
SoftBank received an initial allocation of 4.33 crore rights entitlements based on its 54.15 crore qualifying shares. The investor transferred 1.12 crore of these entitlements on the open market, representing roughly 25.9% of its total quota, retaining 3.21 crore entitlements as of October 22. Selling rights entitlements provides immediate liquidity to an existing shareholder without altering their underlying equity position, transferring the right to purchase new shares at the issue price to the secondary buyer.
| Metric / Transaction Detail | Prior Status / Allocation | Current Status / Disposed Volume | Net Impact |
|---|---|---|---|
| Equity Stake (%) | 12.9% (expanded capital base) | 11.7% | 1.2% stake reduction |
| Total Shares Held | 59.70 Cr shares | 54.15 Cr shares | 5.55 Cr shares sold |
| Rights Entitlements (RE) | 4.33 Cr allocated (Oct 13 record date) | 3.21 Cr retained | 1.12 Cr RE sold (25.9% of allocation) |
| Transaction Period | January 6 – October 22 | Completed open-market sales | Continued institutional sell-down |
Progressive Institutional Exit
SoftBank first backed Ola Electric in July 2019 with an anchor check of $250 million, conferring an early-stage unicorn valuation of approximately $1 billion. The investor subsequently participated in Ola Electric's September 2021 financing round when the manufacturer was valued at roughly $3 billion.
Since Ola Electric’s domestic public debut in August 2024, the Japanese technology backer has systematically reduced its exposure. In January, regulatory filings confirmed SoftBank sold 9.46 crore shares—equal to a 2.15% stake—between September 3 and January 5, which brought its position down to 13.53% at the time. An earlier divestment round executed between July and September saw SoftBank offload another 9.4 crore shares, amounting to another 2.15% reduction.
This continuous tapering comes as Ola Electric faces mounting competitive pressure, contracting market share in India's electric scooter category, and heightened capital needs to manage operating expenses and service corporate debt.
Frequently Asked Questions
How many shares did SoftBank sell in Ola Electric?
SoftBank's investment affiliate, SVF II Ostrich (DE) LLC, sold 5.55 crore shares between January 6 and October 22, reducing its direct stake from 12.9% to 11.7%.
What is a rights entitlement, and why did SoftBank sell them?
A rights entitlement gives an existing shareholder the legal option to buy newly issued shares at a specified price during a rights issue. Selling these entitlements allows an institution to monetize its subscription rights on the open market without reducing its underlying equity shares.
How much of its rights entitlement did SoftBank dispose of?
SoftBank was allotted 4.33 crore rights entitlements under Ola Electric's two-for-25 formula. It sold 1.12 crore of them, representing approximately 25.9% of its total allocation, leaving it with 3.21 crore entitlements.
What was Ola Electric's rights issue target?
Ola Electric launched the rights issue targeting roughly ₹1,000 crore to retire existing debt and finance ongoing operational growth amid declining revenue and market share pressures.
