Authum emerges as highest bidder for Reliance Home Finance

By: |
June 20, 2021 7:16 PM

Sources said lenders led by Bank of Baroda would receive Rs 2,587 crore or 90 per cent upfront and remaining Rs 300 crore within a year.

Authum emerges as highest bidder for Reliance Home FinanceReliance Home Finance (RHF), is a group company of the debt-ridden Anil Ambani-promoted Reliance Group. (Reuters/File image)

Authum Investment and Infrastructure Ltd has emerged as the highest bidder for Reliance Home Finance (RHF), a group company of the debt-ridden Anil Ambani-promoted Reliance Group, with a Rs 2,900 crore offer.

Sources said lenders led by Bank of Baroda would receive Rs 2,587 crore or 90 per cent upfront and remaining Rs 300 crore within a year.

The voting that started on May 31 and concluded on June 19 saw participation from over 91 per cent of the lenders by value, sources said, adding lenders have voted in favour of Authum’s plan over other bids.

Authum is a domestic NBFC with around 15 years of presence and over Rs 1,500 crore networth as on December 31, 2020.

The resolution plan of Authum was selected as it offered Highest Net Present Value (NPV) and has fewer and reasonable conditions, they said.

The bid by the NBFC scored highest in terms of ease of implementation and found to be comprehensive for all the stakeholders including RHF employees and customers, sources said.

Though the plan has been selected considering that overwhelming majority, sources said, few remaining lenders are yet to give their nod due to delay in their internal approvals.

The other bidders are ARES SSG (global fund with over USD 8 billion under management) along with Assets Care & Reconstruction Enterprise Ltd, Avenue Capital (global fund with over USD 9.5 billion under management) jointly with ARCIL and Capri Global Capital Limited — a domestic NBFC.

RHF resolution is the only successful resolution post Altico in March 2020, under June 7, 2019 direction of RBI on Prudential Framework for Resolution of Stressed Assets.

Retail disbursements of Reliance Home Finance had plunged amid tightening liquidity following the collapse of Infrastructure Leasing & Financial Services (IL&FS) in 2018, and significant debt repayments during the September 2018 to February 2019 period.

With the resolution, the debt of Reliance Capital Ltd (RCL) would come down by about Rs 11,200 crore or more than 25 per cent of outstanding.

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