Reliance Commercial Finance gets 13 EoIs from global, domestic investors

The resolution is being pursued by change in management of the entity by acquiring a 100 per cent stake

Reliance Commercial Finance, a wholly-owned subsidiary of Reliance Capital, has received expression of interest (EoI) from as many as 13 global and domestic investors, after lenders decided to seek a resolution of the entity under the June 7 circular of the Reserve Bank of India (RBI) for distressed assets.

Among the investors that have expressed interest in acquiring the entity are Capri Global, Edelweiss Asset Reconstruction Company (ARC), UV ARC, Ugro Capital, JM Finance ARC, India RF, ARCIL, Authum Investments & Infra and Assets Care and Reconstruction Enterprise. Other investors include CFM ARC, Invent ARC, Rare ARC and International ARC.

A consortium of lenders, with Bank of Baroda as lead banker, had invited bids for the troubled entity, with Deloitte managing the bid process as resolution advisors. 

The inter-creditor agreement among the lenders was signed in July 2019, and lenders to the entity comprised banks holding 91 per cent of the total debt. The remaining was held by mutual funds, pension funds and others. The resolution is being pursued on the condition that there will be a change in management of the entity with a 100 per cent stake acquisition. 

A resolution plan from investors would entail acquiring the entity on as-is-where-is basis or buying the firm with one or more asset books on as-is-where-is-basis.

Reliance Commercial Finance’s total borrowing was to the tune of Rs 9,812 crore as of March 2020. It came down from Rs 10,284 crore as of March 2019. Its asset under management or AUM is Rs 11,000 crore. The company is mainly engaged in providing small and medium enterprise loans, loans against property, infra financing, agriculture loans and supply chain financing.