BackSterling and Wilson gains after Shapoorji's deal with KKR to sell solar assets
The transaction with KKR marked the first successful asset monetization since September last year, when the group's debt woes came to the foreSo far, the promoters have paid back ₹1,500 crore to the company, out of a total of ₹2,644 crore
PremiumMUMBAI : Shapoorji Pallonji group company Sterling and Wilson Solar Ltd, which has been in the middle of a storm since the promoters delayed repaying loans owed to the company, has seen its share price hit the upper circuit in two consecutive trading sessions.
Shares of the company edged higher after the group on Monday announced a deal to sell 317 megawatts of solar assets to private equity firm KKR for a Rs1,554 crore.
As of 11.10 AM, Sterling and Wilson Solar shares were trading at ₹166.05 apiece on the BSE, up 5% from the previous close. On Monday too, the stock closed 5% higher.
The positive investor sentiment stems from the hope that the promoters will be able to deleverage the group balance sheet with such asset monetizations.
The transaction with KKR marked the first successful asset monetization since September last year, when the group's debt woes came to the fore.
Shapoorji took Sterling and Wilson Solar public last year. The intent of the deal was to help promoters raise capital, to repay loans they owed to the company.
The loan was to be repaid within 90 days of Sterling and Wilson Solar’s IPO, which ended mid-November 2019.
However, the promoters had sought an extension for repaying the loans, blaming “significant and rapid deterioration in the credit markets". The delayed loan payment, coupled with business disruption caused by covid-19, has seen Sterling and Wilson Solar’s stock crash by 90% from its IPO price of ₹780 per share to ₹76.9.
So far, the promoters have paid back ₹1,500 crore to the company, out of a total of ₹2,644 crore. The remaining amount is to be paid in two tranches, ₹500 crore by 30 June and rest by 30 September.
The Shapoorji group has been chasing several avenues to manage its debt problems.
Mint reported last month that the group was in talks with lenders to raise up to $1 billion by pledging its stake in Tata Sons Pvt. Ltd, the holding company of the Tata Group. Shapoorji holds 18.2% stake in Tata Sons.
The group has also put up other assets on sale, including it roads business and the water purifier and vacuum cleaner business Eureka Forbes.
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