RBI clears resolution plan for Reliance Capital
Mumbai: The Reserve Bank of India on Friday granted approval to the restructuring proposal for financially troubled Reliance Capital, paving the way for the acquisition of the company by IndusInd International Holdings Ltd (IIHL), a firm within the Hinduja Group.
“This is to inform you that the Administrator of Reliance Capital Limited is in receipt of "No objection" vide letter dated November 17, 2023, from the Reserve Bank of India,” the company said in a regulatory filing.
IIHL had won the bid to acquire the debt-ridden firm with the highest offer of Rs 9,650 crore in the second round of auction ended in April.
The Reserve Bank of India (RBI) on November 29, 2021, took over the board of Reliance Capital amid payment defaults and serious governance issues.
RBI designated Nageswara Rao Y as the administrator overseeing the Corporate Insolvency Resolution Process (CIRP) of the company.
Reliance Capital is the third major non-banking financial company (NBFC) for which the central bank has initiated bankruptcy proceedings through the Insolvency and Bankruptcy Code (IBC).
Srei Group and Dewan Housing Finance Corporation (DHFL) are the preceding instances where RBI intervened.
The central bank later filed an application for commencement of CIRP against the company at the Mumbai bench of the National Company Law Tribunal.
In February last year, the RBI-appointed administrator invited expressions of interest for the sale of Reliance Capital.
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