Anil Ambani's Reliance Group reaches agreement with 90% of lenders
The Anil Ambani-led Reliance Group has reached an in-principle "standstill understanding" with more than 90 per cent of its lenders, the company said on Sunday.
 
A Reliance Group statement said that as per the understanding reached, 90 per cent of its lenders will not enforce security and will not sell any of the shares pledged by the promoters till September 30, 2019, on account of lower collateral cover or reduced margin caused by recent unprecedented fall in share prices.
 
The Anil Ambani Group will pay the principal and interest to the lenders as per the scheduled due dates specified in the loan agreements, it said.
 
"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.
 
"The Reliance Group has also informed the lenders that it has appointed investment bankers to place a part of its direct 30 per cent shareholding in Reliance Power Ltd to target institutional investors.
 
"Roadshows by the investment bankers will commence during the next week," the statement said.
 
Value of the promoter stake in Reliance Power, before the unprecedented fall in share prices, was more than Rs 2,500 crore, and would clear more than 65 per cent of the total promoter borrowings, it added. 
 
Earlier this month, the Reliance Group said a few non-banking finance companies (NBFCs), substantially L&T Finance and certain entities of Edelweiss Group, have invoked the pledge on listed shares of the Group and made open market sales of the value of approximately Rs 400 crore during February 4-7.
 
The market capitalisation of the three companies were badly impacted due to the open market sales. 
 
Reliance Infrastructure Ltd holds 40 per cent equity in Reliance Power and "even after placement of its holding by the promoters, majority stake and control remains with Anil Ambani Group", the statement said.
 
"Unlike Zee/Essel Group promoters - where there are about 25 lenders -- the Anil Ambani Group has only nine lenders at promoter level. Some of the key lenders are -- Templeton MF, DHFL Primeamerica MF, Indiabulls MF, IndusInd Bank and Yes Bank.
 
"Also, unlike Zee/Essel Group promoters -- where Indian Mutual funds have lent Rs 7,000 crore -- the Anil Ambani Group has only Rs 1,000 crore borrowings from Indian mutual funds," it added. 
 
According to Reliance, Franklin Templeton comprises 90 per cent of the mutual fund (MF) exposure, and has publicly supported the Anil Ambani Group promoters, saying: "In our view, the transaction remains adequately covered, and we continue to engage with ADA Group to decide the future course of action."
 
"Primeamerica MF and Indiabulls MF, with combined exposure less than Rs 100 crore, are being paid off in full before March 31, 2019," the statement said.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    COMMENTS

    Mahesh S Bhatt

    7 months ago

    Golmaal Zoljhaal MDA & ADA understanding unwritten JV may be Mahesh Bhatt

    Ramesh Poapt

    7 months ago

    I opined earlier that Anil faces bad luck, he isn't fraud

    pennymoney769

    7 months ago

    I think Banks should close their lending businesses and start lending through MF. Whenever there is a default, MFs come together and decide not to invoke the security unlike Banks where they have provide for such assets. SEBI, a sleeping regulator, does not have any option but to allow it happen. if at all any loss incurs, its investors\' loss while CIOs and CEOs are awarded to sweeten the deal from promoters and company Mgt.

    ED attaches assets of D.S. Kulkarni Developers worth Rs904 cr
    The Enforcement Directorate (ED) has attached assets worth Rs904 crore of D.S. Kulkarni Developers Ltd (DSKDL) for cheating and siphoning off deposits worth Rs1,084 crore from Maharashtra investors for more than a decade.
     
    Kulkarni Developers had cheated the investors promising better returns on their money from 2006 to 2017, the agency said on Friday as it attached the properties under the Prevention of Money Laundering Act. 
     
    The attached properties include land, buildings, flats, LIC policies and bank balance. 
     
    The immovable properties estimated at Rs 895 crore are spread over Pune, Fursungi (near Pune), Kolhapur, Sangli and Solapur in Maharashtra, Bengaluru and in the US. 
     
    The movable assets comprise bank deposits of Rs4 crore and LIC policies worth Rs 5 crore.
     
    The ED had initiated the probe on the basis of an FIR and chargesheet filed by the Pune police which mentioned that DSKDL Group chairman Deepak S. Kulkarni, wife Hemanti and their son Shirish, along with others cheated around 35,000 investors in Maharashtra.
     
    The Kulkarnis are accused of forming eight partnership firms -- D. S. Kulkarni and Company, D.S. Kulkarni and Associates, D.S. Kulkarni and Brothers, D.S. Kulkarni and Sons, DSK and Sons, DSK and Associates, DSK Construction, DSK Enterprises -- under the veil of DSKDL with the sole motive to collect the funds from the public mostly based in Mumbai, Pune, Kolhapur, besides other cities of Maharashtra. 
     
    They fraudulently projected these partnership firms to be part and parcel of DSKDL, an ED statement said. 
     
    "Although, none of these eight firms have any profit generating business, yet the accused in connivance with others, cheated the public and collected funds from them in the guise of different deposit schemes..."
     
    The ED said the money trail established that the depositors' money was layered through various high value sham transactions under the guise of capital borrowing, advances against property, director's loan among 40 group companies of the DSK group to project it as untainted money and finally laundered to DSKDL, DSK Global Education, DSK Southern, DSK Motors, DSK Developer corporation (US) and other DSK group firms and in the bank accounts of Deepak Kulkarni, his family members and close relatives.
     
    The laundered money was further utilised to purchase land in India and the US in different construction projects of DSKDL for operative expenditure of the DSK group firms, for repayment of bank loans, for payment of premium of high value life insurance policies and conspicuous consumption. 
     
    DSKDL purchased land at Fursungi for Rs332 crore between 2006 and 2009 for the development of a Special Economic Zone. However, in the entire land purchase dealing, the agriculturists got only Rs147.85 crore and the remaining funds amounting to Rs184.46 crore were siphoned off to the account of Hemanti Kulkarni, the ED said. 
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

     

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    New IL&FS Board pushes for asset-level resolution
    The crisis in the debt-ridden Infrastructure Leasing and Financial Services (IL&FS) is set to be addressed by undertaking asset-level sale process first before putting in place a plan for a single group-level or vertical-level resolution, sources said.
     
    This would mean that IL&FS group's equity stakes in individual assets such as road, power and renewable energy projects will be sold first as part of the exercise to restore health of the crisis-hit entity. Once this process is completed, options would be explored to resolve IL&FS at vertical and group level.
     
    The asset-level resolution plan, which has also been mentioned in the third progress report finalised by the new board under the directions of Ministry of Company Affairs (MCA) and submitted to the National Company Law Tribunal, has been favoured as it maximizes returns for stakeholders while allows transfer of title free and clear of encumbrances.
     
    The infrastructure giant has already initiated asset-level resolution by putting in block 22 road assets across its domestic road vertical IL&FS Transportation Networks Ltd (ITNL). Expression of Interest (EoI) has also been invited renewable energy projects while process is being finalized to sell group entities such as ONGC Tripura Power Company and IL&FS Paradip Refinery Water Limited.
     
    Process for resolution of some of these assets will have to follow further orders of National Company Law Appellate Tribunal that on Monday lifted moratorium lifted on 22 IL&FS firms and another 139 offshore entities. This has paved the way for resolution of some of these entities as the bar prevented recovery of loan and resolution of these debt ridden subsidiaries.
     
    The asset monetisation programme is being undertaken by IL&FS to reduce its debt burden of Rs 91,000 crore.
     
    Earlier, the IL&FS Board also looked at group level resolution but found it unviable at current juncture as it would have required a significant capital infusion from strong investors. Resolution of verticals such as ITNL, IL&FS Securities Services, IL&FS Environment and Infrastructure Services.
     
    Under the new resolution plan, asset by asset solution would be explored through methods including capital infusion, asset monetization or through resolution arrangement with creditors. Asset level resolution and sale of business vertical comprising a basket of companies or entities such as wind energy projects, completed domestic road projects would be done on similar lines of asset level resolution.
     
    Once the asset-level resolution of each vertical holding company is completed, only then resolution of the vertical may be considered. Also, if resolution of an asset fails, it would automatically be put for being wound up or liquidated.
     
    The IL&FS and group entities are facing serious liquidity crisis and have defaulted on interest payment on various debt repayments since August 27, 2018. IL&FS group on December 18, 2018 had initiated the process for asset monetisation programme and floated tender for this purpose.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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