Reliance Capital delays principal payment to NCD holders

Anil Ambani led Reliance Capital announces delay in principal payment to Non-Convertible Debentures (NCD) holders which was due on September 7, 2020 with respect to the Non-Convertible Debenture (ISIN – INE013A071M3).

Anil Ambani led Reliance Capital announces delay in principal payment to Non-Convertible Debentures (NCD) holders which was due today.

The Mumbai based company had earlier intimated the shareholders through exchanges, “in communication dated September 21, 2019, in a completely biased, unwarranted and unjustified rating action on September 20, 2019, CARE Ratings (CARE) had downgraded the Company’s entire outstanding debt to default “CARE D” rating, even though there were no overdues on principal or interest payment to any lender. Further to the above, as communicated vide our letter dated October 11, 2019, that this rating downgrade has initiated acceleration, of various facilities and consequential demands for immediate payment of amounts that were otherwise due and payable in a phased manner over the next 8 years till March 2028, as per the original terms of debt. It is expected that the debt servicing of the Company in relation to the accelerated amounts and otherwise will be delayed.”

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The finance company said in its BSE regulatory filing. The Company is prohibited to dispose off, alienate, encumber either directly or indirectly or otherwise part with the possession of any assets, pursuant to Order dated November 20, 2019 passed by the Hon’ble Delhi High Court in the matter of OMP(I) COMM. 419/2019 and OMP(I) COMM. 420/2019. The Company is also prohibited from transferring, alienating, encumbering or otherwise parting with the possession of assets owned by the Company pursuant to the proceedings initiated by Vistra ITCL (India) Limited, the Debts Recovery Tribunal vide its order dated December 3, 2019.

In view of the above the Company was unable to proceed with its asset monetization resulting in nonpayment of its debt servicing of the principal obligations due on September 7, 2020 with respect to the Non-Convertible Debenture (ISIN – INE013A071M3).