Infrastructure conglomerate Shapoorji Pallonji Group has secured creditor approval to delay payment on one of the nation’s biggest high-yield bonds, just days ahead of the April 30 maturity, according to people familiar with the matter.
The company received unanimous consent from holders representing the outstanding amount of the note, which pays a yield of 20.75%, the people said, asking not to be identified discussing private matters. Creditors have received a 25 basis points consent fee for agreeing to push back the maturity to June 30, they said.
A Shapoorji Pallonji spokesperson didn’t respond to a request for comment.
It was India’s biggest high yield note when Shapoorji unit Goswami Infratech Pvt. issued ₹14,300 crore ($1.5 billion) of the zero-coupon securities in 2023. As of March 31, about ₹13,583 crore was outstanding on the bond, including interest, according to a company statement on April 14.
The group, controlled by billionaire Shapoor Mistry, is best known for building landmarks such as the Reserve Bank of India building and the Al Alam Palace for the Sultan of Oman. Shapoorji has suffered from liquidity crunches after it piled on debt before the pandemic, prompting it to list subsidiaries and offload assets.
Group representatives told some investors earlier this month that the company was considering a potential offering of about $2.6 billion-equivalent of dollar- and rupee-denominated bonds, according to people familiar with the matter. They also said that the proceeds would be used to refinance the Goswami debt that just got extended.
Last year, it closed a separate private credit financing of over $3 billion in India’s biggest deal yet at a yield of 19.75%. Such high yields reflect the risks for creditors. The group faces uncertainty about its ability to transfer its stake in privately-held Tata Sons, which makes up most of the collateral for the private credit deal. Tata Sons’ directors have the ability to block certain share transfers.
Founded more than 160 years ago, the Shapoorji group operates across engineering and construction, real estate, infrastructure, energy and industrial projects.
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