Company has issued Corporate Guarantee on behalf of Varun Beverages (Zimbabwe) (Private) Limited (subsidiary company) as per details in the enclosed intimation.
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Varun Beverages Limited has issued a Corporate Guarantee of USD 22 million on behalf of its wholly-owned subsidiary, Varun Beverages (Zimbabwe) (Private) Limited, in favour of ICICI Bank Limited, UAE. The guarantee secures a credit facility extended by the bank to the Zimbabwe subsidiary and is valid until June 30, 2028. The company clarified that the transaction is at arm's length and that promoter/promoter group have no interest in it. The filing also notes there is no immediate financial impact on the listed entity.
While the company states no direct impact, this guarantee creates a contingent liability of USD 22 million for shareholders. It signals continued capital support for the Zimbabwe subsidiary's expansion, which could be positive for long-term growth but adds off-balance-sheet exposure.