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Rcap exits mutual funds biz; sells stake to Nippon

NEW DELHI: Reliance Capital (Rcap) on Thursday stated it is going to exit the mutual finances trade through selling its stake in Reliance Nippon Life Asset Management Ltd (RNAM) to its three way partnership spouse Japan's Nippon Life Insurance. Both companions dangle 42.88 in step with cent each in the corporate, whilst the remainder is with public shareholders.

Reliance Capital stated it has signed binding definitive agreements with Nippon Life Insurance of Japan.

"Pursuant to the agreements, Nippon Life will also make an open offer to the public shareholders of RNAM at Rs 230 per share, as required under Sebi regulations, and reach the maximum permissible promoter shareholding of 75 per cent for listed companies," Reliance Capital stated in a regulatory submitting.

"The transaction price represents a premium of 15.5 per cent to the minimum 60-day price as specified under the Sebi Takeover Regulations," it added.

Reliance Capital stated it is going to receive proceeds of approximately Rs 6,000 crore through sale of its shareholding to Nippon Life Insurance at Rs 230 a percentage, and the simultaneous Offer For Sale (OFS) to different financial buyers.

"The entire proceeds of Rs 6,000 crore will be utilised to reduce Reliance Capital's outstanding debt by 33 per cent," it added.

Reliance Group chairman Anil D Ambani stated, "...Our longstanding and most valued partner, Nippon Life Insurance, is increasing its stake in RNAM to 75 per cent. The monetisation of the RNAM stake is part of our value unlocking strategy. We expect this transaction, together with other deals underway, to substantially reduce Rcap's debt by over 50 per cent in the current financial year".

JM Financial Limited acted because the guide to Reliance Capital for the above transaction.

Shares of Reliance Capital had been buying and selling 2.34 in step with cent higher at Rs 131.35 apiece on BSE.

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