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Breather for Anil Ambani firms

The Reliance Group will pay the principal and interest to the lenders according to the scheduled due dates specified in the loan agreements
It is learnt that the Anil Ambani group has only nine lenders at the promoter level and that the borrowing by promoters from domestic mutual funds is only around Rs 1,000 crore.

Our Special Correspondent   |   Mumbai   |   Published 17.02.19, 06:42 PM

In a major relief to Anil Ambani, his Reliance Group is understood to have reached an in-principle standstill understanding with more than 90 per cent of its lenders at the promoter group level.

Under the pact, these 90 per cent lenders, largely comprising mutual funds, will not enforce security and sell any of the promoters’ pledged shares till September 30 on account of lower collateral cover or reduced margin following the recent fall in their share prices. It covers the promoter group’s shares held in Reliance Power, Reliance Capital and Reliance Infrastructure.

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According to the understanding, the Anil Ambani-group will pay the principal and interest to the lenders according to the scheduled due dates specified in the loan agreements.

It is learnt that the group has also communicated to the lenders that it has appointed investment bankers to place a part of its direct 30 per cent shareholding in Reliance Power to institutional investors. The roadshows by the investment bankers will begin next week.

Sources who did not wish to be quoted said the value of the promoter stake in Reliance Power, before the fall in share prices, was more than Rs 2,500 crore, and that the placement would clear more than 65 per cent of total promoter borrowings.

According to stock exchange data for the period ended December 31, 2018, the holding of the promoter and promoter group in Reliance Power stood at 75 per cent of which over 43 per cent was held by Reliance Infrastructure.

The sources added in the case of the power firm, even after the placement of its holding by the promoters, the control will remain with the Anil Ambani-group. In Reliance Capital, the promoters held over 52 per cent as on December 31, 2018, and in Reliance Infrastructure it was 49.31 per cent. Market circles pointed out that the agreement is similar to that entered by the Essel group with its lenders last month.

The Subhash Chandra-led group had met mutual funds, NBFCs and banks during which an understanding was reached wherein the lenders said there will not be any event of default declared because of the steep fall in price. The Essel group is planning to sell up to 50 per cent of the promoters’ equity in Zee to a strategic partner to cut the debt of the promoters.

It is learnt that the Anil Ambani- group has only nine lenders at the promoter level and that the borrowing by promoters from domestic mutual funds is only around Rs 1,000 crore. Some of the lenders include Templeton MF, DHFL Primeamerica MF, Indiabulls MF, apart from two other private sector banks.

Among mutual funds, Primeamerica MF and Indiabulls MF with combined exposure less than Rs 100 crore are being paid off in full before March 31.

“We are grateful to our lenders for believing in the intrinsic and fundamental value of our companies, and granting their in-principle approval to standstill arrangements,” a Reliance group spokesperson said.



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