Reliance Capital’s debenture holders set to start asset sale process

Our Bureau Mumbai | Updated on September 21, 2020 Published on September 21, 2020

Appoint SBI Caps, JM Financial to sell assets

The committee of debenture holders of Reliance Capital (RCap) is likely to begin the asset monetisation plan in a bid to recover debt owed by the company. Reliance Capital’s secured debt is about ₹15,000 crore and the debenture holders represent 99 per cent of the total debt of the company.

“The committee led by EPFO and LIC has appointed SBI Caps and JM Finance for fast track resolution and monetisation. Expression of Interest (EoI) by Vistra, the Trustee, is likely to be issued this week,” said a source aware of the developments.

RCap’s key assets include 100 per cent shareholding in Reliance General Insurance Company, the 3rd largest private sector insurer, 49 per cent stake in Reliance Nippon Life Insurance, 100 per cent stake in Reliance Securities, 49 per cent stake in Reliance Asset Reconstruction Company and other smaller investments in real estate sector. Reliance Health, is also a 100 per cent subsidiary of Reliance Capital.

“Resolution applicant may be allowed to bid for controlling shareholding in Reliance Capital, or any individual assets, or any combination of assets,” the source added.

According to analysts, the Employees’ Provident Fund Organisation (EPFO) has an exposure of ₹2,500 crore to Reliance Capital, while Life Insurance Corporation of India has an exposure of ₹4,700 crore to RCap and its subsidiary Reliance Home Finance.

RCFL resolution process

Separately, lenders to Reliance Commercial Finance Ltd and Reliance Home Finance Ltd are proceeding with the resolution plan and have sought bids for the two companies. Deloitte Touche Tohmatsu has been appointed by the lenders as Process Advisors for the resolution process of RCFL, which has now been re-branded as Reliance Money. The book has been categorised into retail and SME, corporate and group and there are three options being considered for resolution.

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Published on September 21, 2020
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