Authum Investment likely winner for Reliance Commercial Finance

After the resolution of RCF, parent firm Reliance Capital may reduce total debt of Rs 9,000 crore from its books, sources said.

By Ankur Mishra

Lenders to Reliance Commercial Finance (RCF) are understood to have voted in favour of Mumbai-based NBFC Authum Investment and Infrastructure’s bid, sources close to the development told FE. Authum’s Rs 1,585-crore bid implies around 20% recovery for financial creditors on a total exposure of Rs 7,688 crore. This is the second Anil Ambani group firm which is likely to be acquired by Authum Investment and Infrastructure after lenders in June declared the NBFC winner for acquiring Reliance Home Finance.

The Alpana Dangi-promoted Authum Investment is in the business of investing in shares and securities. The company, which has a net worth of over Rs 2,400 crore, is also engaged in financing activities, according to its website.

After the resolution of RCF, parent firm Reliance Capital may reduce total debt of Rs 9,000 crore from its books, sources said.

The lenders had earlier extended the inter-creditor agreement (ICA) for RCF till July 31, 2021 for resolution. According to June 7 circular of the Reserve Bank of India, lenders need to extend the time period of the pact if an account has not been resolved within 180 days of signing of the ICA. The lenders had signed the ICA to resolve Reliance Commercial Finance in July 2019.

According to the website of RCFL, it has been re-branded as Reliance Money, and has assets under management worth Rs 11,000 crore. The company is a 100% subsidiary of Reliance Capital. RCFL offers financial products, including small and medium enterprise loans, loans against property, infra financing, agriculture loans and supply chain financing.

The net loss of Reliance Commercial Finance widened to Rs 1,417 crore during the March quarter, compared with Rs 852 crore in the corresponding quarter last year. The total income declined 12% year-on-year to Rs 293 crore.