Dedicated locality research platform
Enter your email address and you will receive
a link to reset your password
In a strategic manoeuvre, Reliance Capital has divested a substantial 45 percent stake worth Rs 54 crore in its publicly listed subsidiary, Reliance Home Finance. This move, conducted via an open-market transaction, is poised to bolster lenders' prospects for recovery. In the present corporate insolvency proceedings, Reliance Capital, formerly under Anil Ambani's leadership, now holds a mere 2.5 percent ownership stake in Reliance Home Finance. Lenders collectively approved an elaborate Rs 9,660 crore resolution strategy devised by the Hinduja Group's brainchild, IndusInd International Holdings, for Reliance Capital.
The intriguing twist lies in the fact that the resolution process for Reliance Capital's offshoots, namely Reliance Home Finance and Reliance Commercial Finance, had already kicked off prior to the Reserve Bank of India formally acknowledging the corporate insolvency of the parent company. Notably, this entire process was executed beyond the jurisdiction of the National Company Law Tribunal (NCLT). Entering the scene with an alternative approach, Authum Investment & Infrastructure took charge of the financial assets of both entities through an innovative out-of-court resolution mechanism.
This ingenious resolution translated into Authum securing Reliance Home Finance's staggering Rs 11,540 crore debt for a significant Rs 3,351 crore while also obtaining Reliance Commercial's substantial Rs 9,000 crore loan portfolio for Rs 1,629 crore. Underpinning this labyrinthine resolution plan, the operations of Reliance Home Finance were amalgamated into the framework of Reliance Commercial Finance. Consequently, on the pivotal date of July 17, Authum embarked on a resolution to cease its housing finance operations and voluntarily surrender its registration as a certified housing finance entity to the esteemed National Housing Bank.
A twist in this narrative is Authum's affirmative decision to pursue voluntary liquidation, a facet that often sparks curiosity. The aftermath of this elaborate financial dance has seen Reliance Capital's ownership diminish to a modest 2.47 percent after the substantial 45.4 percent stake sale. Notably, in a strategic move, the appointed administrator orchestrated a sequential share sale, the timeline including August 4 (at a commendable Rs 2.80 each), August 9 (at an intriguing Rs 2.10), and finally, August 10 (at a compelling Rs 2.00).
Examining market dynamics, a perceptive equity market observer explained that the strategic decision to liquidate Reliance Home Finance shares was the optimal choice, primarily motivated by the objective of maximizing lenders' potential for recovery. An insightful perspective he shared was the underlying concern that these shares would fall into the hands of unsuspecting retail investors. This pointedly underscored the regulatory framework's efficacy and the need for the vigilant Securities and Exchange Board of India (SEBI) to proactively suspend trading upon any corporate liquidation decisions, thereby safeguarding the interests of retail investors.
Propscience is India’s dedicated property news portal. We cover the latest events, news, trends, deals, new launches and more.
All our services and tools are completely free of cost and available 24X7!
We use cookies to give you the best possible service while using our website, please click accept and carry on browsing if you're happy with this. For more information see our Privacy Policy.
Okay, Got it!This disclaimer ("Disclaimer") is applicable to the entire Site. Upon entering the Site it is recommended that you immediately read the Terms and Conditions and Privacy Policy listed therein. Your continued usage of this Site will indicate your unconditional acceptance of the said Terms and Conditions and Privacy Policy. You hereby agree that Propscience reserves the right to modify at any time, the Terms and Conditions and Privacy Policy governing this Site without prior notification. Your usage of the Site implies that you will be bound by any such modification. You agree and acknowledge that it is your responsibility to periodically visit the Site and stay updated with the Terms and Conditions and Privacy Policy of the Website.
The information contained in this Site has been provided by Propscience for information purposes only. This information does not constitute legal, professional or commercial advice. Communication, content and material within the Site may include photographs and conceptual representations of projects under development. All computer-generated images shown on the Site are only indicative of actual designs and are sourced from third party sites.
The information on this Site may contain certain technical inaccuracies and typographical errors. Any errors or omissions brought to the attention of Propscience will be corrected as soon as possible. The content of this Site is being constantly modified to meet the terms, stipulations and recommendations of the Real Estate Regulation Act, 2016 ("RERA") and rules made thereunder and may vary from the content available as of date. All content may be updated from time to time and may at times be out of date. Propscience accepts no responsibility for keeping the information in this website up to date or any liability whatsoever for any failure to do so.
While every care has been taken to ensure that the content is useful, reliable and accurate, all content and information on the Site is provided on an "as is" and "as available" basis. Propscience does not accept any responsibility or liability with regard to the content, accuracy, legality and reliability of the information provided herein, or, for any loss or damage caused arising directly or indirectly in connection with reliance on the use of such information. No information given under this Site creates a warranty or expands the scope of any warranty that cannot be disclaimed under applicable law.
This Site provides links to other websites owned by third parties. Any reference or mention to third party websites, projects or services is for purely informational purposes only. This information does not constitute either an endorsement or a recommendation. Propscience accepts no responsibility for the content, reliability and information provided on these third-party websites. Propscience will not be held liable for any personal information of data collected by these third parties or for any virus or destructive properties that may be present on these third-party sites.
Your use of the Site is solely at your own risk. You agree and acknowledge that you are solely responsible for any action you take based upon this content and that Propscience is not liable for the same. All details regarding a project/property provided on this Site are updated on the basis of information available from the respective developers/owners/promoters. All such information will not be construed as an advertisement. To find out more about a project / development, please register/contact us to visit the site you are interested in. All decisions taken by you in this regard will be taken independently and Propscience will not be liable for any such loss in connection with the same. This Site is for guidance only. Your use of this Site - including any suggestions set out in the Site and or any use of the resources available on this Site, do not create any professional - client relationship between you and Propscience. Propscience cannot accept you as a client until certain formalities and requirements are met.
We use cookies to give you the best possible service while using our website, please accept it and continue browsing if you're happy with this. For more information see our Privacy Policy