Shapoorji Pallonji Group is in advanced negotiations with top global private credit funds to secure as much as $3.3 billion in India’s largest-ever local currency private debt transaction, according to sources familiar with the matter.
Major Global Investors in Talks
Among the key investors engaged in discussions are Cerberus Capital Management LP, Davidson Kempner Capital Management, and Varde Partners LP, sources revealed. Deutsche Bank has been appointed as the sole arranger for the transaction. Other investors considering participation include Farallon Capital Management, Ares Management Corp., and EAAA India Alternatives Ltd.
The Mumbai-based conglomerate, controlled by billionaire Shapoor Pallonji Mistry, is seeking to refinance existing debt through this deal, with various real estate holdings and other assets being used as collateral.
Expanding India’s Private Credit Market
The deal comes amid the rapid expansion of India’s private credit industry, spurred by Prime Minister Narendra Modi’s infrastructure initiatives driving demand for mid-market funding in areas such as solar power, real estate, and roads.
Private credit investments in India totaled $9.2 billion across 163 deals in 2023, according to an Ernst & Young report. However, the report also warned that increased competition was making it harder to close deals while also putting pressure on lending standards.
Debt Refinancing and Market Impact
The proposed bond issuance, denominated in rupees, is expected to launch as early as March 2025, with yields likely in the high teens, sources added. Goswami Infratech Pvt., a unit of Shapoorji Pallonji, previously raised Rs 14,300 crore ($1.6 billion) in 2023 through what was then India’s largest-ever low-grade local currency bond.
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Investor Response and Future Prospects
While negotiations continue, Shapoorji Pallonji, Cerberus, Farallon, and Varde have not yet responded to requests for comment. Ares, Davidson Kempner, Deutsche Bank, and EAAA India Alternatives declined to comment.
If finalized, this deal would set a new benchmark for India’s private credit market, signaling increased investor confidence in the country’s corporate debt space.
(This news was reported by Bloomberg.)
