GG News Bureau
Mumbai, 18th Nov. The Reserve Bank of India (RBI) on Friday gave its approval to the resolution plan for Reliance Capital, which is burdened with debt. This decision opens the door for IndusInd International Holdings Ltd (IIHL), a company from the Hinduja Group, to acquire Reliance Capital.
Reliance Capital Limited has received a no-objection letter from the RBI, dated November 17, 2023, as confirmed by the company in a regulatory filing.
IIHL emerged as the highest bidder in the second round of auction held in April, offering Rs 9,650 crore to take over Reliance Capital, which is struggling with debt. Due to payment defaults and serious governance issues, the RBI took over the board of Reliance Capital on November 29, 2021.
Nageswara Rao Y was appointed by the RBI as the administrator for the Corporate Insolvency Resolution Process (CIRP) of the company.
Reliance Capital is the third major non-banking financial company (NBFC) to face bankruptcy proceedings under the Insolvency and Bankruptcy Code (IBC), following Srei Group NBFC and Dewan Housing Finance Corporation (DHFL).
The RBI subsequently filed an application for the initiation of CIRP against Reliance Capital at the Mumbai bench of the National Company Law Tribunal.
In February of last year, the RBI-appointed administrator invited expressions of interest for the sale of Reliance Capital.