Shapoorji Pallonji Group looking to pledge 18.4% stake in Tata Sons for $1 billion: Report

A construction worker walks past a hoarding of Indian conglomerate Shapoorji Pallonji Group on the outskirts of Mumbai

Shapoorji Pallonji Group is considering pledging 18.4 percent of its stake in Tata Sons to raise $1 billion to help repay its debts, said a report by Mint quoting sources.

The Tata Sons stake is their biggest asset and the Shapoorji Group “needs to infuse significant capital into their businesses”, a source quoted in the report said, adding that talks are in “early stages”.

Moneycontrol could not independently verify the report.

The move reportedly comes as the organisation faces promoter pressure, besides business challenges due to the coronavirus (COVID-19) pandemic and national lockdown.

This development is noteworthy as Mistry’s son Cyrus has been engaged in a legal battle with Tata Group after being ousted as Chairman in 2016. He had taken over the post from Ratan Tata who announced his retirement in 2012.

The NCLT had ruled in Tata’s favour, the NCLAT ruling favoured Mistry.

The matter is now with the Supreme Court.

The group has refused to give any statement on the story as per the report.

The group has faced troubles since undertaking an initial public offering (IPO) for renewable energy arm Sterling & Wilson Solar. It raised Rs 1,920.6 crore from part stake sale in the company, which it promised to use “to clear loans. ”

Besides the Tata Sons stake sale, the Shapoorji Group is also looking at selling Eureka Forbes and certain roads, power and port assets, the report added.