By Ankur Mishra
The timeline for voting on bids for Reliance Home Finance (RHF ) has been extended till June 19, as some lenders could not cast their vote till Tuesday evening, sources close to the development told FE. However, Authum Investment and Infrastructure’s Rs 2,887 crore bid for RHF likely to have crossed requisite voting majority of 66%, said sources close to the matter.
The voting was earlier scheduled to be completed by 5 PM on Tuesday. The other bidders for the company include Capri Global Capital, Avenue Capital in partnership with ARCIL, and global fund Ares SSG along with Assets Care and Reconstruction Enterprise (ACRE).
The total financial indebtedness of Reliance Home Finance stood at Rs 13,400 crore as on May 31, 2021. The list of lenders includes Bank of Baroda, Punjab National Bank, ICICI Bank, HDFC Bank, Canara Bank, Bank of India and Indian Bank, among others.
Although the voting for the troubled home financier is still underway, Authum Investment and Infrastructure may have emerged as the frontrunner for acquiring Reliance Home Finance. “Authum Investment and Infrastructure’s Rs 2,887-crore resolution plan for RHF likely to have crossed requisite voting majority of 66% till Tuesday evening,” said a banker involved in the matter.
As per Insolvency and Bankruptcy Code (IBC), the committee of creditors (CoC) should approve a resolution plan with a minimum 66% votes.
Authum Investment and Infrastructure is a registered non-banking financial institution carrying on the business of investment in shares and securities and also financing activities as per its website.
Lenders had earlier signed an inter-creditor agreement (ICA) to resolve Reliance Home Finance as per the June 7, 2019, circular of the Reserve Bank of India. If the lenders approve a resolution plan, Reliance Home Finance will be the second NBFC to get resolved outside court after Altico Capital.
The net loss of RHF had earlier widened to Rs 445 crore in the March quarter (Q4FY21), compared to a Rs 248 crore loss in the same quarter in FY20. The interest income of the lender halved to Rs 135 crore during Q3FY21, compared to Rs 271 crore during the March quarter last year. Similarly, total income during the March quarter declined 42% year-on-year (y-o-y) to Rs 162 crore. Reliance Home Finance had also disclosed that it has net cash (including cash equivalent, liquid mutual fund investments, fixed deposits, etc.) of more than Rs 1,800 crore.