The Shapoorji Pallonji (SP) Group has initiated discussions with Power Finance Corporation (PFC) to secure up to $1.2 billion for refinancing a portion of the Rs 20,000 crore debt set to mature in the last week of May, according to sources familiar with the matter. These discussions, ongoing for several weeks, are being conducted discreetly. The SP Group had previously pledged its 18% stake in Tata Sons, the holding company of the Tata Group, as collateral for the original loan.
The funds were originally raised by the Mistry family through Sterling Investment Corp. Pvt Ltd (SICPL), which owns slightly over 9 percent of Tata Sons. These bonds, with a maturity period of 3.5 years, were issued in 2021 and were primarily subscribed to by alternative investment manager Ares SSG and hedge fund Farallon Capital.
Initially focused on the development of the power sector in India since its establishment in 1986, PFC exclusively lent to state-run entities until 1996. It later expanded its scope to include private-sector power utilities and projects, and more recently, extended its mandate to encompass lending to non-power sector borrowers.
In other news related to SP Group, last June, Goswami Infratech, an entity under SP Group, raised Rs 14,300 crore through rupee-denominated zero-coupon non-convertible debentures (NCDs) from various investors, including Cerberus Capital, Varde Partners, Canyon Capital, Davidson Kempner, as well as existing lenders Deutsche Bank, Edelweiss Special Opportunities Fund, and Ares SSG. Additionally, discussions were reported in March about SP Group negotiating with existing lenders to extend a significant portion of its debt to a later date.
On March 26, SP Group announced an agreement with Adani Ports and Special Economic Zone to sell a 95 percent stake in Gopalpur Port in Odisha for Rs 1,349 crore. This transaction fulfills a crucial clause in its loan agreement, mandating the sale of Gopalpur within a specified timeframe.
Also in March, Afcons Infrastructure Ltd, a construction company backed by SP Group, filed documents with the Securities Exchange Board of India for a share sale, aiming to raise Rs 7,000 crore through an initial public offering. This IPO, slated for June, is also part of SP Group’s agreement with its lenders.
