Shriram Finance secures over $400 million through syndicated term loans, stock up 7%

The firm said it is the largest ever syndicated loan transaction by Shriram Finance and claimed that it marked the largest widely syndicated loan transaction for a private non-banking financial company (NBFC) from India in recent years. Shares of the firm were trading nearly 7% high on Monday.

According to the company, the three-year external commercial borrowing (ECB) facility was structured as a social loan anchored by BNP Paribas, DBS Bank, HSBC and Sumitomo Mitsui Banking Corporation, who were the joint mandated lead arrangers and bookrunners and social loan coordinators for this facility.

Shriram Finance further pointed out that the multi-currency deal started as a $200 million equivalent facility with a greenshoe option. A greenshoe option is a provision where more funds could be raised than originally planned if demand stays high. “The transaction saw a bumper response from the syndication market, with the final lender group expanding to 16 lenders. This included banks from four continents spanning Europe, US, Asia (North Asia, South-East Asia, Middle East) and Africa (Mauritius),” the firm stated.

The deal also witnessed new lenders who have deployed capital in an Indian firm for the very first time, it added.

Shriram Finance also said that the fund-raise follows closely on the heels of a previous successful transaction where the firm raised $404 million.

Shriram Finance is an NBFC that has offerings ranging from credit solutions for commercial vehicles, two-wheeler loans, car loans, home loans, gold loans, personal and small business loans. The firm has assets under management (AUM) of over ₹2.24 lakh crore.

Shares of the firm have gained nearly 23% since the beginning of the year. The stock has gained over 79% in the last one year.