Hindujas working toward a controlling stake in Anil Ambani’s Reliance Capital

The Hinduja Group is currently in advanced discussions with non-banking financial company 360 One Prime (formerly IIFL Wealth Prime) to secure a loan of Rs 4,000 crore. This funding will be used to partially finance the group’s acquisition of Reliance Capital, a company formerly under the helm of Anil Ambani, through bankruptcy proceedings.

Hinduja group-owned IndusInd International Holdings (IIHL) sought to borrow a total of Rs 8,000 crore for the acquisition. However, the group has encountered pricing hurdles, with various credit funds demanding higher interest rates. Due to the collateral being assets from a bankrupt company undergoing insolvency proceedings, private credit funds are hesitant to offer funds at lower yields.

360 One Prime has reportedly proposed lending Rs 4,000 crore at rates ranging between 14-15 per cent. Although other private credit funds like Ares SSG had shown interest in providing funds, they demanded higher interest rates and offered better covenants.

The committee of creditors (CoC) approved the Hinduja Group’s offer of Rs 9,650 crore in July last year, contingent upon obtaining requisite approvals. At the time, the board of IIHL had also decided to increase its holdings in Reliance Capital to 26 per cent from 15 per cent.

The Reserve Bank of India had approved the resolution plan for Reliance Capital, which is RBI-registered non-banking, non-deposit-taking systemically important company (NBFC-CIC-ND-SI), in November 2023.

Following this, in December, the Competition Commission of India (CCI) approved the acquisition of a stake in Reliance Capital by IndusInd International Holdings, IIHL BFSI (India), and Aasia Enterprises LLP.

The group’s acquisition is still pending court and regulatory approvals. If the transaction is successful, IIHL, along with other entities, will have a controlling stake in Reliance Capital. Business Standard