Shapoorji Pallonji Group seeks to raise up to $200 million to repay debt

Shapoorji Pallonji Group is looking to raise $150 million to $200 million, according to people familiar with the matter, as the Indian conglomerate faces mounting debt obligations.

SP Group plans to raise the funds through private credit by issuing more rupee bonds initially sold by its Eqyizen Investment Pvt. unit in July, said the people, who asked not be named discussing private information. About half of the proceeds will be used to repay creditors of Porteast Investment Ltd., another SP Group unit, they said. The remainder will go toward other group debt, the people said, adding that talks are at an early stage and the size and terms could change.

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The fresh financing would help SP Group cut debt at Porteast and reduce pressure on its loan-to-value ratio, the people said. Representatives for SP Group didn’t immediately respond to a request for comment.

SP Group has faced increasing strain as more debt comes due and it endures a prolonged wait to monetize its assets, including a large stake in Tata Sons Pvt, where executives are locked in a battle over whether or not to list publicly. The Mistry family, which controls SP Group, is the second-largest shareholder of Tata Sons with a roughly 18.4% share.

SP Group’s latest fundraising plan comes after the company borrowed about 44.5 billion rupees ($467 million) in September through Eqyizen and dollar bonds sold by another unit called Mercury Finance Co., the people familiar said. That money was used for amortization payments due at Porteast, they said.

The group is seeking to complete its new financing by mid-November, the people said.