India’s Piramal Capital said to raise $153m from Barclays

Piramal Enterprises chairman Ajay Piramal Photo: Bloomberg

Billionaire Ajay Piramal’s shadow banking unit has borrowed 11 billion rupees ($153 million) from Barclays Plc to refinance part of its existing debt and extend new loans, according to people familiar with the development.

While the rate of interest is 7.5% on the four-month loan deal signed last week between Piramal Capital & Housing Finance Ltd. and the British bank, the blended annualized cost, including the fee, is higher than 10%, the people said, asking not to be named as the information is not public. The Indian non-bank financier has offered to repay the borrowings from the money raised from a proposed share sale, and the security cover is two times the loan value, the people said.

The funding for Piramal Capital comes at a time many Indian financiers are reeling from a 17-month sustained upheaval in the nation’s credit markets, which has hurt cash flow and curtailed their ability to repay loans. Piramal Capital was downgraded to AA from AA+ by ICRA Ltd. and Care Ratings Ltd. in June and July, citing funding challenges faced by the country’s shadow lenders.

A Mumbai-based representative for Piramal and Hong Kong-based spokeswoman for Barclays declined to comment on the deal. Barclays has solely underwritten the loan and will hold it on its books until repayment, one of the people said.

Piramal Enterprises Ltd., the flagship of the group with businesses ranging from lending to drug manufacturing, is in the process of a $770 million rights offering to bolster its balance sheet. In November, the company proposed repaying 15 billion rupees of debt to Standard Chartered Plc. early after getting a waiver on a covenant, people with knowledge of the matter had said.

Bloomberg

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.