Megha Engineering MD PV Krishna Reddy is seeking about $700 million from global private credit investors to fund the purchase of his uncle's stake in the company, according to reports from Bloomberg. A consortium of lenders including Davidson Kempner Capital Management, Elham Credit Partners and Varde Partners has begun preliminary work on the structure of the financing. If completed, this would be among India's largest private credit deals this year, just under half of the equivalent $1.6 billion raised by conglomerate Shapoorji Pallonji Group last month. The people involved in the discussions asked not to be identified because the discussions are private, with terms still not finalised and subject to change.
Billionaire PV Krishna Reddy, the managing director of Megha Engineering who now owns 57% of the company, is raising the money to help finance his acquisition of the remaining 43% stake held by his uncle Pamireddy Pitchi Reddy, the executive chairman, as reported by Bloomberg. The proposed stake buyout remains a financing discussion at this stage, with the structure and terms of the reported private credit deal not yet finalised and discussions still subject to change. Representatives for Megha Engineering, Elham Credit Partners and Varde Partners didn't respond to Bloomberg's requests for comment.
The planned deal highlights the growing role of private credit in financing large shareholder and corporate transactions in India, where traditional lenders could be constrained in offering flexibility on funding certain types of acquisitions, according to Bloomberg reports. Investments in India's private credit market reached $3.5 billion in the first half of 2026, less than half of the $9 billion in deals a year earlier, which included the record $3.1 billion raised by Shapoorji Pallonji Group for refinancing, according to consulting firm EY. The India's private credit sector has doubled in size over the past five years to about $25 billion in assets under management at the end of 2025, according to Moody's Ratings, though this pales in comparison with the US market which manages more than $1 trillion in assets.
Founded in 1989 as a small fabrication unit in Hyderabad, Megha Engineering has projects in more than 20 countries spanning tunnels, ports, highways, water systems and power assets, according to its website as reported by Bloomberg. The company has been seeking to sell some of its road assets, with KKR & Co.-backed Vertis Infrastructure Trust emerging as the frontrunner to acquire eight roads from Megha, Bloomberg reported in July. Megha was the top donor to Prime Minister Narendra Modi's BJP over the past five years, purchasing about ₹6.7 billion ($70 million) of electoral bonds according to 2024 election commission data.
