Insurance Regulator IRDAI has raised some objections to the resolution plan of Hinduja group company IndusInd International Holdings (IIHL) for Anil Ambani’s debt-ridden Reliance Capital. Sources gave this information. The Insurance Regulatory and Development Authority of India, in a recent letter to Reliance Capital administrator Nageswara Rao Y, said IIHL’s resolution plan is not in accordance with insurance norms. The regulator has sought clarification regarding the equity capital that IIHL is ready to invest.
Objection expressed on loan
Sources said the regulator has expressed reservations about the loan that IIHL plans to raise for the acquisition of Reliance Capital. IRDAI is of the opinion that promoters should invest their own capital, as insurance companies manage the policyholders’ wealth and as a regulator, protection of the interests of policyholders is its top priority.
Clarification sought on loan taking plans
The letter also sought clarification regarding the company’s loan taking plans. The regulator has also expressed the possibility of FDI exceeding the prescribed limit after the transfer of Reliance Capital’s stake to IIHL. It is noteworthy that the National Company Law Tribunal had approved IIHL’s resolution plan of Rs 9,650 crore for Reliance Capital on February 27, 2024.
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