Reliance Capital Looks To Cut Debt By Rs 10,000-12,000 Crore Via Sale Of Unit Stakes, Assets
Reliance Capital Ltd. said that it plans to reduce debt by about Rs 10,000-12,000 crore in the next three-four months selling stakes in two businesses and some non-core assets.
"This substantial 50-60 percent reduction in Reliance Capital's debt, will be achieved by monetisation of its 43 percent stake in Reliance Nippon Asset Management Company Ltd. and 49 percent stake in Reliance General Insurance Company Ltd., along with several non-core investments," according to the Anil Ambani group company's emailed statement.
On Feb. 21, Reliance Capital had said that it invited Nippon Life Insurance Company to buy up to 42.88 percent of its stake in Reliance Nippon Life Asset Management—the asset manager in which both the companies are partner-promoters.
Here are the other highlights from Reliance Capital’s statement today:
- The 43 percent stake in Reliance Nippon Asset Management is currently valued at over Rs 5,000 crore; the stake sale will be at a "significant premium to market”.
- Have filed the Draft Red Herring Prospectus with Securities and Exchange Board of India on Feb. 8 for an initial share sale in Reliance General Insurance Company.
- Company is at an advanced stage of selling several non-core investments, including a stake sale in Prime Focus Ltd. and other media assets
Shares of Reliance Capital rose as much 1.7 percent to Rs 193.4 before erasing all its gains and drifting into the negative territory. Reliance Nippon Life stock rallied as much as 9.2 percent to Rs 200.8.