Lenders approve Authum’s plan for Reliance Commercial Finance: Sources

Lenders of Reliance Commercial Finance have approved the resolution plan of Authum Investment and Infrastructure, as per sources.  Authum Investment and Infrastructure’s  (Authum’s) resolution plan has been selected as the successful plan, after several rounds of bidding and negotiation by the lenders and the lead Bank, Bank of Baroda with several bidders. As per sources Authum’s plan with the highest NPV of Rs 1585 crore has received over 80% of the voting in favor of the proposal. 

Voting for the successful bidder and the resolution plan of Reliance Commercial Finance (RCF) that had started on 07 June 2021 and concluded today.  

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Lenders recovery is high as Rs 1240 crore of cash has already been distributed and the Company has additional cash and cash equivalent of over Rs 250 crore as on 30 June 2021, which will be distributed along with plan proceeds. 

 The plan had crossed the fair value as assessed by 2 independent valuers.  

Authum is a domestic NBFC with around 15 years of presence and over Rs 2400 crore networth as on 30June 2021. 

Reliance Commercial Finance resolution to result in overall debt reduction of Reliance Capital by over Rs 9000 Crore i.e. around 25%of debt reduction plans of Reliance Capital 

The process was run by Deloitte Touche Tohmatsu LLP as the resolution advisor and Bank of Baroda as the Lead Bank. 

The deal will be subject to regulatory approvals.  

Authum also emerged as the highest bidder for Reliance Home Finance (RHF).with an offer of Rs 2,887 Cr Crore offer.