Shapoorji Pallonji Close to Signing $3.4 Billion Private Credit Deal

Shapoorji Pallonji Group is in the final stages of securing a $3.4 billion private credit deal, which would be the biggest of its kind in India, as per a Bloomberg report. The deal could be signed as early as this week, though the date may shift depending on final approvals.

Terms of the Bond

The debt will be raised through a three-year, zero-coupon rupee bond. The bond is expected to carry an annualised yield of 19.75%, with a loan-to-value ratio of 16% for a period of 3 years. Funds are expected to be released a few days after the agreement is signed.

According to the report, about a dozen institutional investors are participating. These include Ares Management, Cerberus Capital, Davidson Kempner, and Farallon Capital. Deutsche Bank is also part of the deal and will act as the sole arranger and trustee.

Additional Interest

Other firms such as BlackRock, Pimco, Synergy Capital, Broadpeak, and Sona Asset Management have also joined, according to the Economic Times Report. The bond issue has been fully subscribed. In fact, the demand exceeded what was on offer, leading to tighter allocation than usual.

The deal comes at a time when Shapoorji Pallonji has been working to manage its existing debt. The transaction is also being seen as part of a broader trend of rising private credit activity in India.

Read more: Afcons Infrastructure Secures ₹1,084.54 Crore DRDO Contract

Internal Investigation

On May 10, the group said it had started an internal investigation into an employee recently arrested by the CBI in a bribery case. The company has not shared further details but said it is looking into the matter.

Conclusion

The agreement is close to being finalised. Disbursement of funds is expected shortly after signing. Neither the company nor the investors have made any public statements so far.

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