Shapoorji Pallonji considers pledging Tata Sons shares for $1.6bn.

01 May 2023

Shapoorji Pallonji Group, managed by by billionaire Shapoor Mistry, is reportedly in discussions to secure a private credit facility of $1.6 billion. The conglomerate aims to raise cash and is considering a three-year tenor with a double-digit interest rate.

It is possible that the engineering and infrastructure group may pledge some of its shares in Tata Sons to raise the required capital. Asset sales, including a controlling stake in its flagship engineering firm, are also being considered to generate around $2 billion. Last year, the group sold Eureka Forbes. and Sterling and Wilson Renewable Energy, using the proceeds to repay $1.5 billion to lenders.

Deutsche Bank AG and Standard Chartered Plc are organising the private credit deal, with discussions involving Ontario Municipal Employees Retirement System, Varde Partners LP, Cerberus Capital Management LP, and Farallon Capital Management LLC. The funds raised will be used, in part, to refinance existing loans.

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