New Delhi (Anish Yande): Shares of Reliance Home Finance rose by 4 per cent on Monday’s trading session following the announcement of Authum Investment securing a successful bidder to acquire all assets of Reliance Home Finance. Reliance Home Finance shares opened an intraday high of Rs 5.55 per share from its previous close of Rs 5.30 per share. The market cap of the Reliance Home Finance rose to Rs 269 crore.
Authum Investment selected for acquiring all assets of Reliance Home Finance:
Authum Investment, a non-bank financial institution was selected as a successful bidder for acquiring all assets of Reliance Home Finance. The Mumbai-based company offered Rs 2,900 crore for lenders of Reliance Home Finance.
The non-bank financial institution was successful in the voting process of Reliance Home Finance which has started on May 31. The voting process received participation by more than 91 per cent of the lenders by value. Lenders had selected Authum Investment as the successful bidder on the basis of the highest net present value offered by the company.
The company’s bid includes Rs 2,587 crore as an upfront payment for the lenders. The rest of the bid amounting to Rs 300 crore would be paid to lenders in one year. Reliance Home Finance would also distribute around Rs 1,800 crore of cash to lenders along with the proceeds from the resolution plan.
Reliance Home Finance’s acquisition to reduce Reliance Capital’s debt:
Other bidders for Reliance Home Finance included Avenue Capital in partnership with ARCIL, Assets Care and Reconstruction Enterprise, Global Capital, and Ares SSG.
Previously, Authum Investment had submitted a bid of Rs 2,911 crore including Rs 24 crore as deferred interest. The bid was subject to the terms and conditions which has been approved by the lenders at their meeting held on June 19, 2021.
The acquisition of the entire stake by Authum Investment would reduce Reliance Capital’s debt by 25 per cent at an amount of Rs 11,200 crore. Bank of Baroda has issued a Letter of Intent which announced Authum Investment as the successful bidder.
Authum Investment is an Indian non-bank financial institution. The company has a net worth of over Rs 1,500 crore as of December 31, 2021, and a presence of around 15 years.
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