Shapoorji Pallonji gets bondholders' approval to postpone Rs 1,800 cr interest payment to December end

SP Group had to make an interest payment of close to Rs 1,800 crore on these NCDs by September 30.

Shapoorji Pallonji (SP) Group has secured lender approval to defer a massive Rs 1,800 crore interest payment due on September 30 on its Rs 14,300 crore non-convertible debentures (NCDs) sold last year to December 31, people familiar with the development said.

The approval from lenders was received last week, the people said, requesting anonymity.

In June last year, SP Group entity Goswami Infratech raised Rs 14,300 crore through rupee-denominated zero-coupon NCDs from a group of investors, including Cerberus Capital, Varde Partners, Canyon Capital, Davidson Kempner, as well as existing lenders Deutsche Bank, Edelweiss Special Opportunities Fund and Ares SSG.

SP Group had to make an interest payment of close to Rs 1,800 crore on these NCDs by September 30.

Moneycontrol reported on September 19 that SP group was is in talks with its lenders, including Davidson Kempner and Deutsche Bank, to raise around Rs 2,000 crore in additional debt to make the interest payments, in the event the approval to extend the deadline did not come through.

The request for extension of payment timelines was necessitated because sale of certain assets - Gopalpur port - as well as the pending IPO of group company Afcons Infrastructure has taken longer than anticipated.

In January, Shapoorji sold the Dharamtar port to JSW group and a consideration of Rs 250 crore received from the sale was paid to the NCD holders.

On March 26, SP Group said it had entered into 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. Adani Ports will purchase a 56 percent stake in the port from SP Group and 39 percent from Orissa Stevedores.

In its notice to the NCD holders earlier this month, SP group said that the government of Orissa has approved the change in shareholding of Gopalpur port and the group expects to soon receive a formal approval, and thus hopes to consummate the deal by end of September or early October.

SP group will receive a consideration of Rs 850 crore from this sale.

The group had envisaged that the sale of these port assets could fetch it approximately Rs 1,500 crore, but the sale considerations have fallen short of those targets.

Additionally, Shapoorji is targeting an October launch for the Rs 7,000-crore IPO of Afcons Infrastructure Ltd. As part of the IPO, Goswami Infratech will sell shares worth Rs 5,750 crore, which is to be used towards reducing the group’s debt.

Simultaneously, SP group is also looking to part refinance a loan taken against shares of Tata Sons, held by Sterling Investment Corp. Pvt Limited, which owns a little more than 9 percent of Tata Sons.

Moneycontrol reported on May 6 that SP group has begun talks with Power Finance Corporation (PFC) to secure as much as $1.2 billion to refinance part of the Rs 20,000 crore debt availed against Tata Sons shares.

The funds, according to SP Group’s corporate filings, were raised by the Mistry family through Sterling Investment Corp. Pvt Ltd (SICPL), which owns a little more than nine percent of Tata Sons. The bonds, with a maturity of 3.5 years were sold in 2021, were primarily subscribed by alternative investment manager Ares SSG and hedge fund Farallon Capital.

A spokesperson for SP Group could not be immediately reached for a comment.