Committee of Creditors Flags Concerns Regarding Hinduja's ₹7,300 Crore Reliance Capital Resolution Plan

Concerns Raised by the Committee of Creditors

The committee of creditors (CoC) has highlighted its reservations regarding the term sheets presented by IndusInd International Holdings Ltd (IIHL) related to a ₹7,300 crore debt proposal intended for Reliance Capital. Earlier this month, the National Company Law Tribunal (NCLT) directed IIHL to deliver the necessary term sheets as part of the overarching resolution plan. Although IIHL has consented to submit these documents, confusion and delays have emerged, casting a shadow over the financing arrangements.

Tensions Over Debt Terms

At the core of the conflict are stringent conditions associated with the ₹7,300 crore offering, some of which hinge on fulfilling commitments only viable after the resolution plan’s approval by the NCLT in February. An anonymous lender remarked that IIHL’s secured funding rhetoric is marred by complexities that extend beyond the resolution plan's scope.

• Transfer of 26% shareholding to a Hinduja Group entity, Aasia.
• Requirement for delisting existing shares and debentures of Reliance Capital.
• Creation of security arrangements in favor of lenders to IIHL.
• Issuance of new unlisted RCAP debt securities.

Request for Definitive Documents

With additional terms possibly being introduced in final agreements, the CoC has formally requested IIHL to provide definitive documents for thorough examination.

IIHL has appointed 360 One and Barclays to facilitate the ₹7,300 crore debt arrangement, with specific allocation responsibilities assigned for the total funding.