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Reliance General Insurance to get ₹200cr capital infusion
July 20, 2023
Lenders of Reliance Capital (RCAP) have approved the capital infusion in Reliance General Insurance to improve solvency margin of the general insurance arm, according to sources. The capital infusion is likely to happen by the end of August, they said.
Post the capital infusion by RCAP, Reliance General Insurance will also raise an additional ₹400 crore Tier 2 capital to accelerate growth, sources said.
The capital infusion in Reliance General comes at a time when the Committee of Creditors (CoC) has approved the Resolution Plan of IndusInd International Holdings Ltd (IIHL), a Hinduja Group entity, with 99.6 per cent votes.
The lenders are expected to receive ₹10,000 crore from the IIHL’s resolution plan. The administrator of RCAP has also filed the IIHL’s resolution plan with the NCLT for its approval.
Reliance General Insurance has in the past made multiple appeals to the CoC for the capital infusion.
The general insurer had earlier this year sought ₹600 crore capital infusion from Reliance Capital, but the CoC rejected the demand.
Reliance General had said that the delay in the resolution process of Reliance Capital was causing severe stress to its business and the company urgently required ₹600 crore capital infusion from Reliance Capital to improve its solvency level.
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