Reliance Capital shareholding in RGIC transferred to IDBI Trustee Services

Anil Ambani-led Reliance Capital on Tuesday said its shareholding in a wholly-owned subsidiary, Reliance General Insurance Company Limited (RGIC), has been transferred to IDBI Trustee Services.

The shareholding has been transfered upon invocation of pledge by the IDBI Trustee Services, Reliance Capital said in a stock exchange filing.

The company, however, did not disclose financial details.

It further said the Trustee has purported to act on behalf of two parties claiming against the Reliance Capital under certain guarantees, while another lender has filed a suit in the High Court of Bombay, claiming inter alia that the aforesaid shareholding in RGIC comprises security for all secured lenders, and the matter is presently sub-judice.

"The Company has already been engaged in efforts to monetise its shareholding in RGIC as part of its overall plans for debt reduction," it said.

As per the filing, the company would take all appropriate steps in the matter as legally advised to protect the interests of its lenders and other stakeholders.

Meanwhile in another filing, Reliance Capital said interest and principal obligations in regards Non-Convertible Debenture due on Monday has been delayed.

The company said in a "completely biased, unwarranted and unjustified rating action" on September 20, 2019, CARE Ratings (CARE) had downgraded its entire outstanding debt to default "CARE D" rating, even though there were no overdues on principal or interest payment to any lender.

Referring to an earlier communication to exchanges, Reliance Capital said the rating downgrade has initiated acceleration of various facilities by certain lenders and consequential demands for immediate payment of amounts that were otherwise due and payable in a phased manner over the next 8 years till March 2028.

It is expected that the debt servicing of the Company in relation to the accelerated amounts and otherwise will be delayed, the company added.

"Accordingly, as regards the Non-Convertible Debenture , the interest/ principal obligations due on November 18, 2019, is also delayed," it said.

The company shares closed at Rs 19 apiece on BSE, down 5 per cent.



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel