Reliance Power, led by Anil Ambani, recently paid off debts owed to three banks – ICICI Bank, Axis Bank, and DBS Bank. Meanwhile, its parent company, Reliance Infrastructure, is in the process of settling dues amounting to Rs 2,100 crore with JC Flowers Asset Reconstruction Company.
According to sources familiar with the matter, Reliance Power aims to become debt-free by the end of the fiscal year. They have settled debts with the three banks, recovering around 30-35% of the principal loans.
Reliance Infrastructure and JC Flowers ARC had previously agreed to a standstill agreement, giving Reliance Infrastructure time to arrange funds. This agreement, initially set until March 20, 2024, has been extended to March 31, 2024.
Reliance Power recently raised Rs 240 crore in equity from VFSI Holdings, a subsidiary of Varde Partners. It’s speculated that these funds were used to settle dues with the banks.
Yes Bank, the original lender, transferred its distressed loan book to JC Flowers ARC, including loans to Reliance Infrastructure and Reliance Power.
As of December 31, 2023, Reliance Power’s total financial indebtedness stood at Rs 765 crore, while Reliance Infrastructure’s was Rs 4,233 crore for the same period.
In April 2023, Reliance Power settled loans with JC Flowers ARC and Canara Bank. Additionally, in September 2022, Reliance Power allotted 200 million equity shares to VFSI Holdings, resulting in an infusion of Rs 240 crore.
In August of the same year, Reliance Commercial Finance, now acquired by Authum Investment & Infrastructure, invested Rs 1,043 crore in both Reliance companies, further aiding in debt resolution.
