Subhash Chandra-run Essel plans to raise $400 m to refinance group's Mauritius holding firm

Subhash Chandra-run Essel Group is planning to raise $400 million fund in a structured credit transaction for refinancing a part of the promoter debt and is in talks with investors in this regard, said a media report.

“Discussions are currently underway with potential lenders, including AION Capital and KKR,” a person directly aware of the development was quoted as saying by Mint. The source added that the funds would be used to refinance debt of the group’s Mauritius holding company, which has investments across multiple businesses.

In November 2018, Essel Group had said that it was planning to sell up to 50 percent of the promoters' equity in the group flagship media arm Zee Entertainment Enterprises Limited (ZEEL) to a strategic partner.

 Subhash Chandra-run Essel plans to raise 0 m to refinance groups Mauritius holding firm

File image of Subhash Chandra. News 18

The group appointed Goldman Sachs Securities India as the investment banker and the multinational LionTree as an international strategic advisor for the deal, which it expects to be concluded by March or April 2019.

"Even though our business is on a strong footing, given our global ambitions and the rapidly converging world of content and technology, we have decided to get a strategic partner with a strong technological expertise and global reach which will help us achieve our ambitions faster," ZEEL managing director and chief executive Punit Goenka told PTI. 

The proposal to divest up to 50 percent of promoter holding was expected to address the group's capital allocation priorities. The capital will go into completely retire debt of the promoters and to pursue new interests, Goenka said.

In July 2018, Essel Infraprojects, a subsidiary of Essel Group, said it was planning to invest Rs 1,750 crore in phased manner to set up electric vehicle (EV) charging and battery swapping infrastructure.

"In a massive boost to the electric vehicle segment in the country, Essel Infraprojects Ltd, (EIL) an enterprise of Subhash Chandra led Essel Group, launches its electric vehicle charging and battery swapping infrastructure initiative under Essel Green Mobility Limited in Lucknow," the company said in a statement.

Under the project, EIL will invest Rs 1,750 crore in phased manner with the launch of 250 charging stations, 1,000 battery swapping stations in 20 cities of Uttar Pradesh.

In June 2018, Essel Infraprojects was in advanced stages of selling its 685-MW solar business to Greenko group. The deal size could be to the tune of $1 billion, they added.

Global private equity fund Actis and Tata Power were also in the fray along with Greenko to buy the assets of Essel. However, their deals did not go through, the sources said.

When contacted, an Essel spokesperson told PTI, “As an infrastructure conglomerate, we keep on evaluating various opportunities. However, we would not like to comment on market speculation.”

--With PTI inputs



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Updated Date: Jan 10, 2019 12:49:20 IST