Reliance Capital to monetise its stake in RGICL for debt reduction
The Insurance Regulatory and Development Authority of India (IRDAI), vide its direction dated 27 December 2019 has held that the pledge/transfer of shares of Reliance General Insurance Company (RGICL), a 100% subsidiary of Reliance Capital (RCAP), was in violation of the applicable provisions of law.Pursuant to IRDAI direction, the 100% share holding RGICL stands restored to RCAP.
IRDAI directed trustee not to give effect to any encumbrance / transfer or any change in the Shareholding of the RGICL.
In November 2019, the Trustee had transferred RCAP's 100% shareholding in RGIC by invoking pledge, which was being contested by the Company.
IRDAI ruling has protected the interest of all lenders and debenture holders of RCAP. This will now help RCAP to monetise its stake in RGIC and to reduce its debt.
The company will continue its efforts to monetize its shareholding in RGICL as part of its overall plans for debt reduction.
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