The Reserve Bank of India (RBI) has approved the resolution plan for debt-ridden Reliance Capital, paving the way for Hinduja Group entity IndusInd International Holdings Ltd (IIHL) to acquire the company. According to a regulatory filing, the Administrator of Reliance Capital received a “No objection” from the RBI on November 17, 2023.

This approval marks a crucial step in Reliance Capital’s resolution process, bringing clarity to its future and signalling the completion of the acquisition by Hinduja Group’s IIHL.

IIHL emerged as the highest bidder in the second round of the auction, offering Rs 9,650 crore to take over Reliance Capital. The prolonged battle for the acquisition has now reached a resolution with the RBI’s approval.

In response to payment defaults and serious governance issues, the RBI superseded the board of Reliance Capital on November 29, 2021, appointing Nageswara Rao Y as the administrator for the Corporate Insolvency Resolution Process (CIRP). 

The central bank subsequently filed an application for the initiation of CIRP against Reliance Capital at the Mumbai bench of the National Company Law Tribunal. With the RBI’s recent approval of the resolution plan, IIHL’s acquisition of Reliance Capital is set to move forward.

Reliance Capital is the third significant non-banking financial company (NBFC) against which the RBI initiated bankruptcy proceedings under the Insolvency and Bankruptcy Code (IBC), with the others being Srei Group NBFC and Dewan Housing Finance Corporation (DHFL).