Reliance Capital Ltd.’s commercial finance division has been spun off into a separate wholly owned subsidiary, after 99.9 percent of the equity shareholders voted in favor of the move.
The demerger of Reliance Commercial Finance will be effective April 1, 2016, and will now need requisite court and regulatory approvals, Reliance Capital said in a press release. The company had assets under management of Rs 16,451 crore as of June 30.
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The demerger will help unlock value for the company, Sam Ghosh, the executive director and Group chief executive officer of Reliance Capital said in a press release.
This transfer will align RCF with overall operating structure of Reliance Capital where all operating businesses are held in its wholly or majority owned subsidiaries. The proposal will enhance management focus and also provide flexibility to the company to unlock value through stake sale.Sam Ghosh, ED & Group CEO, Reliance Capital
The transfer will also enhance employee engagement and retention through the ability to grant employee stock ownership plans, the company added.
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