IndusInd To Acquire Debt-Ridden Reliance Capital After NCLT Approval
IndusInd To Acquire Debt-Ridden Reliance Capital After NCLT Approval
The next hearing is scheduled for 26 February
Following the approval of the National Company Law Tribunal (NCLT), IndusInd International Holdings Limited (IIHL) will soon acquire the debt-ridden Reliance Capital of the Anil Dhirubhai Ambani Group
During the hearing, IndusInd confirmed the submission of definitive documents and achieving financial closure towards implementation of Reliance’s resolution plan (RP).
The next hearing will be held on 26 February (by when the acquisition will happen) and the closure of implementation of approved RP and handing over the control of Reliance and its subsidiaries to IndusInd will take place.
The lenders of IndusInd have assured of the remaining Rs.4,300 crore funding to complete the payment of Rs.9,861 crore of the value to Reliance’s creditors.
Meanwhile, IndusInd has completed over 58 percent of the RP value (Rs.5,750 crore) by depositing in various escrow accounts - two of which are in CoC-designated accounts (Rs 2,750 crore) as per the NCLT order.
As part of the funding, IndusInd submitted documents to the administrator to be placed and approved by Reliance’s monitoring committee. The documents would now be executed and the funds initiated.
On acquisition, IndusInd hopes to bolster its banking, financial and insurance services more than three-fold to USD 50 billion in the next five years as against the current valuation of USD 15 billion on 30 September 2024.
Meanwhile, it has secured approvals from the Reserve Bank of India (RBI), the Insurance Regulatory and Development Authority of India (IRDAI), and the stock and commodity exchanges.
In April 2023, it emerged as the successful resolution applicant, winning the bid at Rs.9,650 crore, to acquire the troubled financial services firm under the Corporate Insolvency Resolution Process (CIRP) of the Insolvency and Bankruptcy Code (IBC).
In November 2021, the RBI superseded the Reliance board on governance issues and payment defaults. It appointed Nageswara Rao Y as the administrator, who invited bids in February 2022 for the company’s takeover.
