Anil Ambani is struggling under heavy debt, with his companies facing insolvency. Reliance Capital, a bankrupt company owned by Anil Ambani, has been acquired by the Hinduja Group through a successful auction. The Hinduja Group is making efforts to raise funds to complete the ₹9,650 crore deal, but it has suffered a major setback as banks have refused to grant loans.
Reliance Capital, a financial services company owned by Anil Ambani, was auctioned off, with IIHL, a company of the Hinduja Group, making the highest bid. However, IIHL is now struggling to arrange the funds necessary for the acquisition after banks refused to lend to them. The delay in this deal is due to the banks’ denial of loans to IndusInd International Holdings Limited (IIHL).
According to Bloomberg’s report, since the Hinduja Group did not receive a favorable response from banks, they will now raise funds through bonds. IndusInd International Holdings (IIHL) has planned to borrow ₹4,300 crore through a non-convertible debenture (NCD) issue.
Reliance Capital’s Insolvency Saga
Reliance Capital, Anil Ambani’s bankrupt company, owes more than ₹40,000 crore. Due to the inability to repay debts, the company had to undergo insolvency proceedings. Reliance Capital is currently undergoing a corporate insolvency resolution process. On February 27, 2024, NCLT approved the acquisition of Reliance Capital by a subsidiary of the Hinduja Group. However, they were required to complete the acquisition by May 27, 2024, which they failed to do. The company has requested an additional 90 days in the funds due to delays.
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Financial Services Decline
The company used to offer around 20 services related to finance to its customers through Reliance Capital, including life insurance, general insurance, health insurance, as well as services in sectors like home loans, commercial loans, equity, and commodity broking. This company used to be a pride of the stock market. In 2008, Reliance Capital’s shares were priced at ₹2700, but due to the burden of debt, they plummeted to ₹11.90 on its final trading day. Trading of the shares of this bankrupt company was halted.
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