Shapoorji Pallonji & Company (SPCPL), the holding firm of the billionaire Pallonji family, is likely considering selling its stake in Sterling and Wilson Renewable Energy (SWRE), Reuters reported citing a report in Business Standard newspaper. SPCPL may sell its 14 per cent stake for approximately Rs 1,800 crore in a bid to meet its financial obligations by the end of this month.
Additionally, there are plans to manage another Rs 20,000 crore debt, currently held within Goswami Infratech, a promoter entity. A source aware of the matter told Business Standard that this debt is likely to be refinanced by engaging with new debt investors.
The source mentioned that the non-convertible debentures had been raised at a high rate of 18 percent interest per annum, and the group is considering ways to decrease its interest burden.
ET had reported in February citing unnamed sources that the Mistry family, who are the promoters of Shapoorji Pallonji (SP) Group, are considering raising ₹15,000 crore in five-year loans using cash flows from their real estate business. This initiative aims to substitute high-cost debt.
The funds will be used to redeem bonds issued three years ago that have onerous clauses that could take the coupon rate on them to unusually high levels if the debtholders are not paid off by June, they said. The bonds bear a coupon of 20% and are collateralised by shares of Tata Sons, in which the Mistry family holds an 18% stake.
In their personal capacity, the Mistrys are believed to have amassed approximately Rs 24,000 crore in debt. Additionally, their companies have individually acquired loans amounting to Rs 20,000 crore.
The group’s chairman Shapoor Mistry has been trying to find ways to get more cash because the SP Group is facing problems with higher interest rates. In 2022, the SP Group sold Eureka Forbes Ltd., which makes water purifier equipment, to Advent International in a deal worth 44 billion rupees ($536 million). They also sold a stake in Sterling and Wilson Renewable Energy Ltd. to Reliance Industries Ltd.
It was also reported last year that Afcons, a unit of the Shapoorji Pallonji group, has begun discussions with banks about launching an initial public offering (IPO) of its shares.
According to bankers, Shapoorji Pallonji & Company (SPCPL) has to repay Rs 1,500 crore of term debt by the end of the fiscal year 2024-25. As of September 30, 2023, the company has already repaid Rs 382 crore, BS reported.
Source: Economic Times