SP group’s debt recast may be impacted by the ruling

Our Bureau Mumbai | Updated on March 27, 2021

Valuation of Group’s stake in Tata Sons could be an issue

The Shapoorji Pallonji group’s ongoing debt restructuring could, to some extent, be impacted by the Supreme Court’s verdict in favour of Tata Sons.

It is too early to fully assess the impact of the verdict, but the valuation of the SP group’s stake in Tata Sons could be a tricky point as both sides will have to reach an agreement, sources said.

“The SP group’s debt restructuring has been going on and it is also looking at asset monetisation, which could help the process. But both sides have to reach a valuation, which could be an issue.” said a banking source.

An email query to the SP group from BusinessLine on the issue did not elicit a response.

In talks to revamp debt

In September 2020, the SP Group had sought relief to restructure its ₹10,900-crore of debt under the resolution framework for pandemic-related stress. It has actively been in talks with lenders and is expected to finalise the package soon.

The group is looking to monetise its assets and may sell its stake partly or fully in at least three of its group companies-- Eureka Forbes, Sterling and Wilson Solar and Afcons Infrastructure -- as part of the one-time debt restructuring package.

The company plans to raise about ₹10,332 crore through this asset sale. “The lenders would like SP group to raise funds through asset sale before the debt revamp is agreed upon. The other option is to pledge the shares held by SP group in Tata Sons but that cannot be done now due to the court orde,” said a banking source.

Published on March 26, 2021

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