Reliance Capital: CoC’s counsel asks Indusind International Holdings to roll out IBC plan before Mar 31

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Reliance Capital bankruptcy: Reliance Capital Ltd‘s Committee of Creditors of Reliance Capital has written to Hinduja Group-backed Indusind International Holdings Ltd. to implement the resolution plan before the end of this month, which is part of the debt resolution process.

In a letter dated March 4, Luthra and Luthra Law Offices asked IndusInd International Holdings (IIHL) to ensure that “in line with its own commitment, the resolution plan is implemented on or before March 31, 2024”.

In June 2023, RCap lenders approved the resolution plan submitted by IIHL. It is to be noted that Hindujas-backed IndusInd International has submitted a proposal that includes an upfront cash payment of Rs 9,650 crore, which is 37.03 per cent of the initial amount claimed.

Besides, the company is also willing to pay an amount of Rs 50 crore for the benefit of the CoC, which will be part of the upfront cash and an additional Rs 11 crore over and above the proposed amount.

“The CoC would like to highlight that pursuant to the discussions held between the representatives of IIHL, including Ashok Hinduja (promoter of Hinduja group), in the meeting of the CoC held on December 13, 2023, IIHL had clarified and committed that IIHL would implement the Resolution Plan and make payments to the lenders in terms of the Resolution Plan before March 31, 2024,” the letter from CoC’s legal representative stated.

“However, the CoC notes that, till date, certain documents and information in relation to regulatory approvals (IRDAI) continue to be pending at IIHL’s end, as also the implementation steps, despite multiple follow-ups. In light of the above, the CoC hereby requests IIHL to provide the necessary information/ documents and cooperation in order to obtain relevant regulatory approvals at the earliest. The CoC further requests IIHL to ensure that, in line with its own commitment, the Resolution Plan is implemented on or before March 31, 2024,” the letter added.

RCap’s CoC comprises LIC, Employees’ Provident Fund Organisation, IndusInd Bank, Deutsche Bank and various financial institutions, including IDBI Trusteeship Services and Broadpeak Investment Advisors.

On December 13, 2023, IIHL had said it would implement the resolution plan and make payments to the lenders before March 31.

The National Company Law Tribunal (NCLT) approved the resolution plan of IIHL on February 27 this year. In its order, NCLT said: “Since the implementation of the resolution plan is subject to the satisfaction of the conditions precedent (CP), the timeline of 90 days from the NCLT approval date shall automatically stand extended by such number of days as are required for the satisfaction of the CP.”

However, the CoC is yet to get certain documents and information, including those pertaining to regulatory approvals, which are needed for faster completion of the resolution process. The resolution plan is subject to various approvals, including those from the Securities and Exchange Board of India, Reserve Bank of India and the Insurance Regulatory and Development Authority of India, among others.

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