InvestorQ : Why has Piramal Enterprises prepaid the short term loan taken?
diksha shah made post

Why has Piramal Enterprises prepaid the short term loan taken?

Answer
user profile image
Archita Jajjoo answered.
2 weeks ago


About a month ago, Piramal Enterprises had taken a short term loan from Barclays Bank for a sum of Rs.1000 crore with tenure of 110 days just to meet their short term liquidity needs. That loan has been repaid after a period of 1 month itself as liquidity flows came in.

During the week, Piramal Enterprises prepaid its 3.5 month loan of its Rs.1000 crore loan from Barclays Bank in just one month. The loan had carried an interest rate of 8%. PEL’s subsidiary, Piramal Pharma, had recently received Rs.3523 crore on sale of 20% stake.

The stake sale, valuing Piramal Pharma at an enterprise value of $2.4 billion, was done to CA Alchemy Investments, a Mauritius based fund affiliated to the Carlyle group. Carlyle is one of the largest PE funds in the world and quite active in Indian pharma space.

Recently, there have been a slew of private equity or PE deals in the API, CRAMS and bio-similar space and PEL has leveraged this deal to reduce its group debt. Piramal Pharma contributes to 41% of the overall revenues of the Piramal group.