Mauritius-based IndusInd International Holdings and other Hinduja group entities are expected to make payments worth Rs 9,661 crore for the acquisition of bankrupt Reliance Capital (RCap) only after getting all the legal and regulatory clearances, including from the Supreme Court, thus delaying the closure of the transaction. A source close to the development said that according to the National Company Law Tribunal (NCLT) order dated February 27, the payment for the acquisition was to be made within 90 days from the NCLT's approval of the resolution plan and after receiving all legal and regulatory clearances.
Insurance sector regulator IRDAI has given conditional approval to Hinduja Group firm IndusInd International Holdings Ltd (IIHL) for the takeover of debt-ridden Reliance Capital. "We are happy to acknowledge the receipt of approval from IRDAI yesterday (May 10, 2024) on the auspicious occasion of Akshay Tritiya. "The approval is subject to certain 'regulatory, statutory, and judicial' clearances/compliances," an IIHL spokesperson said in a statement.
The National Company Law Appellate Tribunal (NCLAT) on Thursday allowed a petition filed by lenders of Reliance Capital seeking another round of auction for the debt-ridden firm undergoing insolvency process. A two-member bench set aside an order passed by NCLT and said the Committee of Creditors (CoC) has the power to negotiate and call for a higher bid. The appellate tribunal permitted the CoC to continue with the challenge mechanism and invite bids after two weeks.
IndusInd International Holdings chairman Ashok Hinduja on Tuesday announced the acquisition of Reliance Capital, completing the three-year-long resolution process of the debt-ridden company. IndusInd International Holdings Ltd (IIHL) has transferred the bid amount to the escrow account of the lender, and the takeover of the management from the Administrator will happen on Wednesday.
Tata AIG, ICICI Lombard and Nippon Life have evinced interest for the profit-making insurance arm of Reliance Capital (RCap), joining several prominent financial companies from India and abroad in the race for RCap's assets. The final day to submit an expression of interest (EoI) was March 25 and the bidders will now get access to the latest information about RCap before they make financial bids.
The Hinduja group is learnt to have backtracked from making a minimum Rs 8,950-crore offer for Reliance Capital (RCap) - a deal that it had belatedly put forth in December, after Torrent Investments emerged as the highest bidder for the bankrupt firm in the challenge process. The Hindujas' latest move has put Indian lenders, with an exposure of Rs 24,000 crore, in a spot as it was the former's revised offer that led to a call for a second auction and litigation by Torrent, which had placed a bid of Rs 8,649 crore in the first auction. Torrent has moved the Supreme Court and plans to wait for the apex court verdict before participating in any fresh auction. A banking source said there was an informal meeting of a few lenders of Reliance Capital with the bidders - the Torrent group and the Hinduja group on Friday when the latter changed its stand. The meeting of RCap's committee of creditors (CoC) is scheduled for Monday.
Mauritius-based Hinduja group firm IndusInd International Holdings (IIHL) has informed the administrator of Reliance Capital that it is ready with its equity contribution of Rs 2,750 crore in cash to acquire the bankrupt firm, but it wants certain conditions to be met in accordance with the resolution plan before transferring the amount. IIHL has also filed an application with the Mumbai Bench of the National Company Law Tribunal (NCLT), seeking directions for the administrator and the committee of creditors (CoC) to complete all pending activities to close the transaction and not let the lenders invoke the bank guarantees provided by the firm earlier.
Reliance Capital has two credit verticals -- Reliance Commercial Finance and Reliance Home Finance -- with a cumulative asset of over Rs 25,000 crore.
The Hinduja group is learnt to be looking at alternative means of financing, including private credit, to fund its Rs 9,661 crore all-cash offer to acquire Reliance Capital. The regulator, Insurance Regulatory & Development Authority of India (Irdai), had earlier rejected the collateral offered by the group to raise funds. The Hinduja group was in talks with Barclays, JPMorgan, Cerberus Capital Management and Apollo Global Management to raise up to $850 million.
Independent valuers have given a liquidation value of up to Rs 13,000 crore for Reliance Capital, sources said. The Reliance Capital administrator, in the Committee of Creditors (CoC) meeting held on Wednesday, presented the valuation reports of the independent valuers - Duff & Phelps and RBSA, to the lenders. According to sources, independent valuers Dufff & Phelps and RBSA have given a liquidation value of around Rs 13,000 crore for Reliance Capital (RCAP).
Lenders have postponed the second auction to sell bankrupt Reliance Capital's assets by a week to April 11, even as the Torrent group, the highest bidder in the first round, pursues litigation in the Supreme Court. Lenders are expecting the Hinduja group and Torrent to participate in the second auction and maximise the value of the assets. American financial services major, Oakteee may also join the race, said a source.
Lenders of debt-ridden Reliance Capital have voted in favour of a resolution plan submitted by Hinduja Group firm IndusInd International Holdings Ltd (IIHL) which made the highest cash offer of Rs 9,661 crore in the second round of bidding. As much as 99 per cent votes were in favour of IIHL as lenders expected to recover cash upfront of Rs 9,661 crore from the Hinduja Group entity, sources said. Besides, sources said cash balance with Reliance Capital (RCAP) of over Rs 500 crore would also go to lenders. So, in all lenders are expected to receive about Rs 10,200 crore for distribution as against Rs 16,000 crore principal secured debt, resulting in 65 per cent recovery for the lenders, sources said.
Blackstone, KKR, and Bain Capital, among others, are in the race for its general insurance arm, and Bandhan Bank, Bain, and Dabur Investments have shown interest for RCap's 51 per cent stake in the life insurance business.
Debt-ridden Reliance Capital ready to cede control in home finance - Blackstone, Carlyle, Brookfield, and Piramal group are in talks to buy a large stake in Reliance Home Finance.
Debt-ridden firm Reliance Capital on Monday objected to the proposed 33.12 per cent stake sale of Prime Focus Ltd (PFL) by Credit Suisse to PFL's promoter group at Rs 44.15 per share. Anil Ambani's Reliance Group company Reliance Capital in a statement termed the proposed transaction as a blatant abuse of the purported rights by Credit Suisse under certain lending agreements with the RCAP Group. However, Reliance Capital did not share the details of the "blatant abuse of the purported rights".
A Hinduja Group firm on Wednesday emerged as the highest bidder with an offer of Rs 9,650 crore to take over debt-ridden Reliance Capital in the second round of auction, sources said. The bid by IndusInd International Holdings Ltd (IIHL) is higher than Rs 8,640 crore offer made by Torrent Investments in the first round of auction held in December last year. The other two suitors -- Torrent Investments and Oaktree -- did not participate in the second round of auction, sources said.
More asset sales may be only way out, though most of the group companies' ratings have been downgraded and their combined market value is now a fraction of their combined debt.
RCap had proprietary investment book of Rs 2,000 crore (Rs 20 billion) as on end-March and owns stake in a host of companies.
The RBI now brings in important and contentious changes directly through voluminous Master Directions, or Master Circulars
Hamsini Karthik reveals why the ongoing business rejig will help unlock value for shareholders of Grasim, Reliance Capital and Tube Investments
Reliance Capital on Wednesday said it has got approval from the Indian market regulator Sebi and the Monetary Authority of Singapore (MAS) for Rs 1,450-crore (Rs 14.5 billion) stake sale in its mutual fund business unit to Japan's Nippon Life.
The junior Ambanis - Anmol and Anshul - were inducted on the board to respect the wishes of the shareholders who during the recent AGM asked the management to get fresh blood into the company by bringing them on board.
Ambani said, in the telecom space, the focus will be on debt reduction, and the virtual merger did away with the need for major capex and will help towards this
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