Shriram Finance Sets New Benchmark with Multi-Currency USD 468 Million Syndicated Loan

On June 3, 2024, Shriram Finance Limited (SFL) informed the stock exchanges that it had recently completed a significant fund-raising effort, securing USD 425 million and EUR 40 million through a syndicated term loan transaction. This marks the largest widely syndicated loan transaction for a private non-banking financial company (NBFC) from India in recent years and Shriram Finance’s largest-ever syndicated loan transaction.

This achievement closely follows a previous successful transaction where SFL raised USD 404 million. The success of these deals underscores lenders’ strong confidence in Shriram Finance’s financial stability and business model.

The three-year External Commercial Borrowing (ECB) facility was structured as a Social Loan anchored by DBS Bank (DBS), BNP Paribas (BNPP), Sumitomo Mitsui Banking Corporation (SMBC) and Hongkong & Shanghai Banking Corporation (HSBC), who were the joint Mandated Lead Arrangers & Bookrunners and Social Loan Coordinators for this facility.

The company stated that the multi-currency deal began as a USD 200 million equivalent facility with a greenshoe option. The transaction saw a significant response from the syndication market, with the final lender group expanding to 16 lenders. This included banks from 4 continents spanning across the US, Europe, Asia (including North Asia, South-East Asia, and the Middle East) and Africa (Mauritius). Notably, the transaction attracted new lenders venturing into Indian corporate investments for the first time, highlighting the robust demand for premier Indian clients in global loan markets.

The Executive Vice Chairman of Shriram Finance Limited, Mr. Umesh Revankar, said, “We are thrilled by the robust participation from lenders across geographies for our External Commercial Borrowings. This marks the largest syndicated multi-currency transaction by a private-sector Non- Banking Finance Company. This facility is labelled as a Social loan, reflecting our commitment to social impact similar to our priority sector initiatives, with certain strict exclusions. The strong interest from the international investor community underscores the global confidence in our mission.”

The Managing Director and Head of Debt Finance at HSBC India, Mr Chetan Joshi, said, “HSBC is delighted to have partnered with Shriram on two highly successful back to back syndicated loans. Coming close to the heels of the sole HSBC-led USD 404 m transaction in 2023, this larger dual currency loan has established Shriram as a well-accepted credit story in the international loan market.”

Aligning its focus on increasing the accessibility of financial services to the unbanked and underbanked sectors, Shriram Finance Limited stated that the funds raised through this social loan will be utilised to empower small entrepreneurs and vulnerable groups across India.

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