Prestige Estates Projects Limited has informed the exchange about issuance of guarantee for loan availed by Canopy Living LLP, Joint Venture of the Company.
PRESTIGE · price
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Prestige Estates Projects Limited is issuing a corporate guarantee of up to INR 400 Crores to Aditya Birla Capital Limited to secure a term loan facility being availed by Canopy Living LLP, which is a joint venture of the company. The promoter and promoter group have no interest in the transaction, and the guarantee has been extended on an arm's length basis in line with the Companies Act, 2013 and SEBI Listing Regulations. The filing was made under Regulation 30 of the SEBI LODR Regulations, with details provided in Annexure I. The company has stated that this guarantee is a contingent liability and, at present, has no impact on Prestige Estates since Canopy Living LLP is part of its consolidated group.
This adds up to INR 400 Crores of contingent liability to Prestige Estates, exposing the company to repayment risk if the joint venture defaults. However, since Canopy Living LLP is a consolidated JV, the move is likely aimed at supporting project funding and is not seen as materially adverse in the near term.