SP Group may get Rs 14K cr lifeline from PFC soon

Both PFC as well as the GP Group didn’t respond to calls to confirm the development.
SP Group may get Rs 14K cr lifeline from PFC soon
Suresh

MUMBAI: The board of state-run Power Finance Corporation (PFC) has reportedly approved a credit line of Rs 14,000 crore to cash-strapped Shapoorji Pallonji (SP) Group, which has been trying to secure funds to pay due to its bond holders since February, according to a source.

The loan will be secured by the SP Group’s 18.37% stake in Tata Sons, the person in the know of the development told TNIE, requesting not to be named. However, this does not mean the deal is done, the source added, saying such a large credit line takes time to get completed.

Both PFC as well as the GP Group didn’t respond to calls to confirm the development.

The SP Group has been looking to raise Rs 20,000 crore, of which it was seeking about Rs 17,000 crore from PFC, to refinance and part-pay a part of its Rs 20,000 crore debt pile, a part of which was due in the last week of May, the person said.

SP Group raised these funds initially through Mistry family’s investment firm Sterling Investment Corp, which owns a little over 9% in Tata Sons, in 2021 and the 3.5-year-money mostly came in from alternative investment manager Ares SSG and hedge fund Farallon Capital and few Hong Kong funds.

In June 2023, the group entity Goswami Infratech raised Rs 14,300 crore via rupee-denominated zero-coupon non-convertible debentures from various investors including Cerberus Capital, Varde Partners, Canyon Capital, Davidson Kempner, and existing lenders Deutsche Bank, Edelweiss special opportunities fund, and Ares SSG.

The person said the PFC board has given the approval after its legal team green-lighted the loan proposal as the articles of association of Tata Sons demand the SP Group.

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