The Reserve Bank of India has rejected Religare Enterprises Ltd.s' proposal to buy 87.5% stake in Religare Housing Development Finance Corp., a subsidiary company of Religare Finvest Ltd., and asked it to submit a fresh application.
Religare Finvest is a wholly owned subsidiary of Religare Enterprises.
Religare Enterprises entered into a share purchase agreement on April 5 with Religare Finvest and RHDFCL for acquisition of entire 87.5% equity stake of RHDFCL held by RFL, Religare Enterprises said in a regulatory filing on Thursday.
The RBI has returned the application made by RHDFCL for prior approval with an advice to submit a fresh one with complete information, it said.
In pursuance of the share purchase agreement, RHDFCL would submit the application in due course, it added.
RFL was put under the Corrective Action Plan Framework by the RBI in January 2018 due to corporate governance issues.
In March 2023, RFL completed the One Time Settlement of its secured and unsecured debt with its 16 lenders by payment of Rs 2,178 crore. Post OTS, the outstanding unsettled unsecured debt is Rs 330 crore (secured debt is nil) as of March 31, 2023.
However, RFL is still placed under RBI's Corrective Action Plan.
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