NCLT Approves Hinduja Group’s Revival Plan for Anil Ambani Promoted Reliance Capital
Mumbai:The National Company Law Tribunal (NCLT) on Tuesday approved the Rs 9,650 crore resolution plan of IndusInd International Holdings Ltd(IIHL), a Hinduja Group firm to acquire the bankrupt Reliance Capital Ltd.
Interestingly, another bidder Torrent’s plea challenging IIHL's resolution plan for Reliance Capital is due in the Supreme Court and is likely to be taken up next Tuesday.
The Mumbai bench of the NCLT approved the resolution plan submitted by IIHL in June 2023 in the second round of bidding for Reliance Capital.
Reliance Capital’s cash balance of an additional Rs 500 crore would also go to the lenders. As a result, lenders are expected to receive about Rs 10,200 crore for distribution against Rs 16,000-crore principal secured debt, resulting in a 65 per cent recovery.
In November 2021, the RBI had superseded the board of the Reliance Capital on governance issues and payment defaults.
The central bank had appointed Nageswara Rao Y as the administrator, who invited bids in February 2022 to take over the company.
Anil Dhirubhai Ambani promoted Reliance Capital had a debt of over Rs 40,000 crore, and four applicants had initially bid with resolution plans. The four resolution applicants were Torrent Investments, IIHL, Cosmea Financial-Piramal Group and Oaktree Capital. However, the committee of creditors rejected all the four plans for lower bid values and a challenge mechanism (Dec 21, 2022) was initiated where
IIHL and Torrent Investments participated. In June 2023, the Hinduja Group firm was selected by the committee for its bid of Rs 9,661 crore upfront cash.