Shapoorji Pallonji taps Deutsche Bank, DAM Capital to raise Rs 3,000 crore from private credit funds
Shapoorji Pallonji Group has mandated Deutsche Bank and DAM Capital to raise Rs 3,000 crore at mid-teen interest rates to refinance high-cost debt from private credit funds Ares SSG Capital and Farallon. The debt is due for repayment next year.
«Deutsche Bank and DAM Capital have been mandated to raise Rs 3,000 crore by Shapoorji Pallonji Group to arrange debt at mid-teen rates for refinancing existing liabilities,» a source familiar with the matter said. «The fundraise will reduce the interest burden from the current 18-22% rate, as the company is looking to lower the overall cost of capital.»
The proceeds from this issuance will be used to refinance upcoming maturities and partially prepay Ares and Farallon. These bonds, issued in 2021 with a three-and-a-half-year tenor, are set to mature soon. The group has approached several large funds and global banks to gauge interest, two sources indicated.
«The engagement with funds will use the rate at which it borrows from PFC as the pricing benchmark,» added another source.
Emails to Shapoorji Pallonji Group did not elicit a response, while Deutsche Bank and DAM Capital declined to comment.
In June, the board of state-run Power Finance Corporation (PFC) approved a Rs 15,000-crore loan to Shapoorji Pallonji Group companies, backed by the company's cash flows and the group's 18.5% stake in Tata Sons, as reported by ET on June 19… However, Tata Trusts has maintained that the Tata Sons shares are not freely transferable, as reported by ET on May 29.
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