Two years after it exited its once flagship Reliance Communication (RCom), the Anil Ambani-led group of companies has now downed shutters on its lending business – Reliance Capital.
In the Annual General Meeting (AGM) of the Anil Dhirubhai Ambani Group (ADAG), held on Monday, 30 September, Chairman Anil Ambani announced the shutting down of two credit verticals of the company - Reliance Commercial Finance and Reliance Home Finance.
"As part of the business transformation, Reliance Capital (RCap) has decided to exit the lending business. Both our lending businesses — Reliance Commercial Finance and Reliance Home Finance – are working closely with all our lenders and other stakeholders to finalise the resolution plans which are expected to be completed by December," Ambani told the shareholders at the AGM, reported news agency PTI.
He said even after shuttering the lending business, RCap will continue to be the financial shareholder of these companies so that shareholder value increases under the new management and effectively debt of reliance capital comes down by Rs 25,000 crore.
Launched 15 years ago, RCap employs around 30,000 people as well.
Ambani Hit By Slowdown
Ambani blamed the crisis and the resultant decision to exit to the severe collateral damages the group had taken due to a combination of factors — crisis in the financial services sector, irrational action by auditors and rating agencies and now the slowdown of the economy.
“These events aided and abetted by reckless selling and rumour mongering by vested interest have affected our shareholders,” he said.
He claimed that his group has over 60,000 crore of receivables in regulatory and arbitrary matters which are pending for the past five to 10 years.
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