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RCap says shareholding in RGIC transferred to IDBI Trustee Services

November 20
00:56 2019

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.Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.

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