Srei Equipment Finance, a wholly-owned subsidiary of Srei Infrastructure Finance, announced Thursday that it has received Expressions of Interest (EoIs) from international private equity investors for a capital injection of up to $ 250 million. The PE funds are Arena Investors from the United States and Makara Capital Partners from Singapore.
Notably, the Reserve Bank of India appointed an auditor in November last year to conduct a special audit of Srei Infrastructure Finance and Srei Equipment Finance (SEFL).
SEFL’s strategic coordination committee, chaired by independent director Malay Mukherjee, will coordinate, negotiate and conclude discussions with PE investors to bring capital into the business and advise management, Srei Infrastructure Finance said in a stock exchange filing. . Ernst & Young will advise the committee on the proposed fundraising exercise.
“SCC operates an independent investor identification process and has received expressions of interest from Arena Investors and Makara Capital Partners. This process runs alongside the debt realignment plan. SCC will engage in discussions with potential investors to raise new capital for the company, which will provide a cushion against the stress of the pandemic in the Indian financial services space, ”the statement said.
Srei has a consolidated debt of around Rs 20,000 crore with Indian banks and around Rs 10,000 crore through bonds and other financial institutions.
Through a separate stock exchange filing Thursday, President Hemant Kanoria told investors that in the coming months, Srei expects concrete commitment / progress in areas of debt realignment plans through a consultative process between different classes of creditors, under the auspices of the NCLT or as advised by commercial banks and fundraising plans to consolidate the capital of Srei Equipment Finance, the operating company.
Interestingly, Brickwork Ratings (BWR) downgraded SIFL’s long term ratings on the innovative perpetual debt instrument to “BWR D” from “BWR BB” / credit monitoring with negative implications. “The downgrade is due to continued delays in meeting SEFL debt repayment obligations and the enforceability of the BWR’s cross-default policy which is in line with SEBI guidelines,” said the rating agency.