Two people aware of the development told ET that lenders are ready to recover the settlement amount, after eight months of a agreeing with the deal to sell Anil Ambani-promoted Reliance Home Finances (RHFL) to Authum Investment Infrastructure.
Disputing creditors – a Shapoorji Pallonji entity and lenders led by Bank of Baroda agreed on a ‘conditional settlement’, thereafter Delhi High Court on December 21, and vacated a stay on the distribution of proceeds from the sale of RHFL.
People mentioned that the amount of ₹1,565 crores will be distributed by the Authum Investment to 33 lenders to those who signed an intercreditor agreement (ICA).
Shapoorji Pallonji (SP) entity Always Remember Properties Pvt Ltd, which claimed Rs 200 crores, will receive a settlement amount of Rs 46 crores, as per the terms of the settlement. As per the court order and resolution plan the amount is proportionate to the amount distributed to other lenders.
Delhi High Court prohibited RHFL from disposing of, alienating, or encumbering either directly or indirectly any of its assets, after an appeal done by SP Group in November 2019 seeking a settlement of Rs 200 crore. This prevented lenders from concluding the debt resolution process of RHL.
As per the settlement terms, the balance amount of Rs 154 claimed by the SP entity, will be deposited with the Delhi High Court and will be paid to the appropriate party based on the outcome of the arbitration between the parties involved.
Yes Bank will be the biggest beneficiary of the distribution of proceeds, as it will receive Rs 319 crore. Bank of Baroda will get Rs 262 crore, along with other lenders, Life Insurance Corp would receive Rs 184 crore, Canara Bank Rs 150 crore, and Punjab & Sind Bank Rs 138 crore.
Lenders who ICA signed must write a consent agreement stating that the settlement amount will be reversed to the adjudicating authority in case of any adverse order.
Authum appeared as the winning bidder in June 2021, for RHFL offering Rs 2,683.23 crore to lenders and NCD holders. However, this offer did not include Rs 200 crore overdue of the SP group entity.
For now, Authum will distribute Rs 1,565.7 crore among creditors that sign the consent agreement by the month’s end.
RHFL has a total overdue of Rs 11,541 crore. A sum of Rs 223 crore is allocated for retail bondholders having up to Rs 5 lakhs of bonds, while a sum of Rs 896 crore is set aside for non-ICA lenders.
This is the second Anil Ambani company acquired by Authum Investment after acquiring Reliance Commercial Finance.
The parent company, Reliance Capital, is undergoing insolvency proceedings with the Hinduja Group and Torrent Investment outbidding each other to buy the core investment company.
Hinduja gave an improved offer of Rs 9,400 crore a day after the auction ended as against Rs 8,640 crore offered by Torrent Investment at the auction held on Wednesday.