Shapoorji Pallonji Group looks to raise $1.6 bn via private credit facility, may pledge shares in Tata Sons: Report

Indian conglomerate, Shapoorji Pallonji Group is likely looking to raise $1.6 billion through a private credit facility. For this, speculations are that the Group may pledge some of its shares in Tata Sons.

People familiar with the matter told Bloomberg that Shapoorji Pallonji Group is in talks to raise $1.6 billion via a private credit facility. Discussions are focused on a tenor of three years, with a rate of interest in the double digits.

These sources told that the infrastructure group could pledge some of its shares in Tata Sons to raise the capital.

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However, when contacted by Bloomberg via text message to confirm the development, a Shapoorji Pallonji spokesperson didn’t comment.

Earlier, in April, Bloomberg had reported that the group has been seeking ways to free up cash as rising interest rates bite. It is weighing asset sales including a controlling stake in its flagship engineering firm that could raise about $2 billion.

Last year, in September, Shapoorji Pallonji Group sold a majority stake in its consumer durables business under the Eureka Forbes label to US-based private equity fund Advent International for a sum of ₹4,400-crore. Proceeds from the sale were said to support the 156-year-old conglomerate to pare its debt and focus on the flagship construction and engineering business under Afcons.

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Meanwhile, earlier in April month, the Economic Times had reported that SP Group has already pledged close to 9 per cent of its 18.37% stake in Tata Sons.

Tata Sons is the principal investment holding company and promoter of Tata companies. 66% of the equity share capital of Tata Sons is held by philanthropic trusts, which support education, health, livelihood generation, and art and culture.