Hinduja Group Initiates Rs 4300 Cr Plan for Acquiring Reliance Capital

The Hinduja Group has initiated a significant ₹4,300 crore (~$51.47 million) plan for the acquisition of Anil Ambani-led Reliance Capital. Hinduja Group's IndusInd International Holdings (IIHL) received approval from the Insurance Regulatory and Development Authority of India (IRDAI) for the acquisition of Reliance Capital.

The bankruptcy court NCLT Mumbai approved IndusInd International Holdings' resolution plan for acquiring Reliance Capital in February. Notably, the Hinduja Group entity submitted its ₹9,650 crore bid for the company just 24 hours after the auction deadline in December 2022.

To close the acquisition, IndusInd International Holdings (IIHL) is raising funds through a non-convertible debenture (NCD) issue. IIHL requested a 90-day extension beyond the original deadline of May 27, 2024, to arrange necessary regulatory approvals and secure funding. The debt includes both domestic market sources and global private credit funds.

As of the March 2024 quarter, Anil Ambani's family remains listed as promoters in the Reliance Group company. Anil Ambani himself holds no shares, while his wife Tina owns 2,63,474 shares, and their son Jai Anmol Ambani holds 28,487 Reliance Capital stocks.

Reliance Capital is currently undergoing the corporate insolvency resolution process, with Nageswara Rao Y appointed as administrator by the Reserve Bank of India under the Insolvency and Bankruptcy Code, 2016.

The acquisition includes taking over Reliance Capital's insurance arms: wholly-owned subsidiary Reliance General Insurance and the 51:49 joint venture with Nippon Life, known as Reliance Nippon Life Insurance.

The National Company Law Tribunal (NCLT) approved IIHL's ₹9,650 crore resolution plan for Reliance Capital. The implementation is pending approval from the Reserve Bank of India (RBI) for the proposed corporate restructuring of implementing entities.

Reliance Capital had a debt of over ₹40,000 crore. IIHL's bid of ₹9,661 crore upfront cash was selected by the committee of creditors. Additionally, Reliance Capital's cash balance of an extra ₹500 crore will go to the lenders.

The acquisition has received approvals from banking and capital markets regulators, as well as the Competition Commission of India (CCI). However, the IRDAI expressed certain concerns, including potential violations of foreign direct investment caps in insurance companies and reliance on borrowings for the acquisition.

Overall, the acquisition process is progressing, subject to regulatory clearances and compliance.

Besides Reliance Capital, an another Anil Ambani led company, Reliance Naval and Engineering (RNEL), was taken over by Mumbai-headquartered business house Swan Group's Swan Energy Limited, in January this year. Swan Energy acquired erstwhile Anil Ambani group company Reliance Naval & Engineering (RNEL), in December 2022.

Dhananjay Tiwari named Reliance Capital CEO

Reliance Capital on Tuesday said it has appointed Dhananjay Tiwari as its chief executive officer.

Tiwari has been appointed as an additional director of the company to hold office till the conclusion of the ensuing annual general meeting, the company said in a regulatory filing.

It added that Tiwari has been appointed as the company's chief executive officer with effect from January 21.

Tiwari, 51, has over 25 years of experience in financial service sector, including portfolio management, product risks, credit risk and enterprise risk management.

Tiwari is also an executive director of Reliance Commercial Finance Ltd.

Prior to joining Reliance, he served as chief risk officer of Vistaar Financial Services Pvt Ltd and senior vice-president with HDFC Bank Ltd, the filing said.

Before HDFC Bank, he has also worked with Kotak Mahindra Group, it added. PTI

Reliance Capital Sells 1% Stake In Paytm For Rs 275 Crore

Back in February, we reported how Anil Ambani's Reliance Capital was contemplating selling its 1 per cent shareholding in the Delhi NCR-based payment and commerce company Paytm to Chinese e-commerce giant Alibaba. And now comes the news, that the deal has been inked.

Reliance Capital has reportedly sold its share in Paytm to Alibaba and its payments affiliate Ant Financial for a whopping amount of Rs 275 crores.

It is important to note here, that Reliance Group's financial services arm had spent just Rs 10 crore for this stake in Paytm. The company made this investment seven years ago in the year 2010 just ahead of the proposed IPO for Paytm parent company, One97 Communications, which was aborted at a later stage.

Reliance Capital, which is a constituent of CNX Nifty Junior and MSCI Global Small Cap Index, is a part of the Reliance Group. It is amongst India’s leading and most valuable financial services companies in the private sector. Over the last couple of months, the industry rumour mill was hot with rumours that the company is in talks with a lot of potential buyers for the sale of its 1 per cent share in Paytm. The partial sale of its stake ended up churning out over 25 times the gains for the ADAG Group firm.

Alibaba and Ant Financial's move to buy Reliance Capital's 1 per cent stake in Paytm is a well thought out move. The two companies together own a 40% stake in One 97 Communication, Paytm's parent company. The two had most recently hiked their stake in the online retail unit when Alibaba Group led a whopping $200 million round in Paytm E-commerce, which was recently demerged from One 97. Paytm E-commerce has been modelled after Alibaba's famous digital platform TMall.

Not only Alibaba and Ant Financial, but there are several other suitors in the industry which are vying for a secondary stake in Paytm's parent company One 97 Communications, which is currently valued at $4.8 billion. However, unfortunately, it is all talks and no action for them till now.

Prior to this, Paytm founder and CEO Vijay Shekhar Sharma had recently sold his 1 per cent holding in One97 Communications to raise about Rs 325 crore. The money has been put into the group's payments bank operations which are expected to commence by the end of this month.

Reliance Capital Sells 1% Stake In Paytm For Rs 275 Crore

Back in February, we reported how Anil Ambani's Reliance Capital was contemplating selling its 1 per cent shareholding in the Delhi NCR-based payment and commerce company Paytm to Chinese e-commerce giant Alibaba. And now comes the news, that the deal has been inked.

Reliance Capital has reportedly sold its share in Paytm to Alibaba and its payments affiliate Ant Financial for a whopping amount of Rs 275 crores.

It is important to note here, that Reliance Group's financial services arm had spent just Rs 10 crore for this stake in Paytm. The company made this investment seven years ago in the year 2010 just ahead of the proposed IPO for Paytm parent company, One97 Communications, which was aborted at a later stage.

Reliance Capital, which is a constituent of CNX Nifty Junior and MSCI Global Small Cap Index, is a part of the Reliance Group. It is amongst India’s leading and most valuable financial services companies in the private sector. Over the last couple of months, the industry rumour mill was hot with rumours that the company is in talks with a lot of potential buyers for the sale of its 1 per cent share in Paytm. The partial sale of its stake ended up churning out over 25 times the gains for the ADAG Group firm.

Alibaba and Ant Financial's move to buy Reliance Capital's 1 per cent stake in Paytm is a well thought out move. The two companies together own a 40% stake in One 97 Communication, Paytm's parent company. The two had most recently hiked their stake in the online retail unit when Alibaba Group led a whopping $200 million round in Paytm E-commerce, which was recently demerged from One 97. Paytm E-commerce has been modelled after Alibaba's famous digital platform TMall.

Not only Alibaba and Ant Financial, but there are several other suitors in the industry which are vying for a secondary stake in Paytm's parent company One 97 Communications, which is currently valued at $4.8 billion. However, unfortunately, it is all talks and no action for them till now.

Prior to this, Paytm founder and CEO Vijay Shekhar Sharma had recently sold his 1 per cent holding in One97 Communications to raise about Rs 325 crore. The money has been put into the group's payments bank operations which are expected to commence by the end of this month.