Mumbai: Sanjay Dangi-promoted NBFC Authum Investment & Infrastructure has invoked guarantees issued by Anil Ambani-promoted Reliance Infrastructure (RInfra) and Reliance Power (RPower) to the erstwhile Reliance Commercial Finance (RCFL) and Reliance Home Finance (RHFL), and converted ₹1,043 crore of debt of the two companies into equity.
Boards of RInfra and RPower approved the preferential allotment on Saturday following which a notice was issued for shareholder approval on Sunday. Authum had completed the takeover of Anil Ambani companies RCFL and RHFL through a lender-led process in October and March, respectively.
Both NBFCs had given short-term intra-corporate loans guaranteed by RInfra and RPower. Since these group companies have not been able to pay back these loans, the liability must be borne by the guarantees that have now been invoked.
“In order to avoid litigation and dispute, both parties agreed to amicably settle the above dues whereby the entire amount of interest, penal interest, costs, charges and other expenses stand fully discharged and the amount as debt payable by the company is crystallized to ₹891.26 crore,” RInfra said in a notice to shareholders.
RInfra will issue a total of 44.3 million shares at ₹201 per share. Similarly, RPower will issue 75.9 million shares at ₹20 per share to pay back ₹152 crore of debt. Authum will hold 1.99% in RPower and 11.19% in RInfra post the allotment.
“With the allotment of these shares, Authum gets a stake in the companies and a likely potential upside if the shares rise. It is not clear whether Dangi wants to increase its stake in the future,” said a person familiar with the matter.
Authum did not reply to an email seeking comment. Dangi when reached on the phone declined comment. Both the acquisitions will be done through RCFL which was acquired by Authum in October last year and which was used later in March to complete the acquisition of RHFL. Shareholders have time to vote till September 5.
