Reliance Capital sells stakes to Nippon, exits mutual funds business

By Akshay Kedari  Date: 2019-05-25

Reliance Capital sells stakes to Nippon, exits mutual funds business

Reliance Capital, a financial services company has recently entered an agreement with Nippon Life Insurance of Japan, for exiting its stake in Reliance Nippon Life Asset Management, reports source.

For the record, Nippon Life Insurance made initial investment in RNAM, in 2012. The company is 130-years old and is one of the largest Life Insurance companies in Japan. It manages assets of $700 billion, revenues of over $70 billion & core operating profit of approximately $6.8 billion.

The company employs 70,000 employees & serves around 14 million customers, worldwide. It has been investing globally in asset management companies and have acquired 24.75 % stake in TCW of U.S. at the end of 2017 & 5% stake in DWS of Germany in March last year. It runs operations internationally- across Asia, Europe, U.S. & Australian region.

As per industry experts, the current share of the partners in the JV is 42.88%, the rest of the share is with public shareholders. According to the agreement, Nippon Life is expected to make an open offer of RNAM at Rs 230 per share to the public shareholders under SEBI regulations and reach maximum permissible promoter shareholding of 75% for listed companies, indicating Nippon to hold 75% stake in the asset management company.

Anil Dhirubhai Ambani, Chairman of Reliance Group was reportedly quoted saying that the monetization of RNAM stake is a part of company’s value unlocking strategy. The transaction is expected to reduce RCAP’s debt by 50 % in the current fiscal year, he added.  JM Financial Ltd. acted as an advisor for the transaction.

As specified in the SEBI Takeover Regulations, the transaction amount represents a premium of 15.5% to the minimum 60-day price. Reliance Capital is expected to receive approximately Rs 6,000 crore by selling off its shareholding to Nippon Life Insurance at Rs 230 per share & simultaneously OFS (Offer for Sale) to other financial investors. The proposed transaction is expected to reduce 33% of Reliance Capital’s debt. The transaction is subject to regulatory approvals, cites source.

Source credits: https://www.moneycontrol.com/news/business/companies/reliance-capital-to-sell-entire-stake-in-amc-jv-to-nippon-life-4010421.html

About Author

Akshay Kedari     aeresearch.net

Akshay Kedari

A qualified computer engineering graduate, Akshay Kedari takes pride in having his way with words. Following his passion for content creation, he writes insightful pieces on aeresearch.net and a few other portals. Also endorsed with a short-term experience in web deve...

Read More

More News By Akshay Kedari

Televisa and Univision announce merger; launch a Spanish media company

Televisa and Univision announce merger; launch a Spanish media company

By Akshay Kedari

The collaboration is aimed at expanding the video streaming portfolio in Spanish-speaking markets. Television Univision has raised USD 1 billion in a Series C funding round led by SoftBank Group Corporation. In recent developments, Mexican broad...

Klevu launches Discovery Suite to boost online retail conversion rates

Klevu launches Discovery Suite to boost online retail conversion rates

By Akshay Kedari

Klevu Oy, a leading provider of AI-based search technologies for online retailers, has reportedly launched a comprehensive solution called Discovery Suite that can allow brands to capture shoppers’ intent in order to improve their conversion ra...

SK Group acquires 16.3% stake in VinCommerce for USD 410 million

SK Group acquires 16.3% stake in VinCommerce for USD 410 million

By Akshay Kedari

SK Group of South Korea has purchased 16.3% of Vincommerce, Vietnams leading retail business operator, for USD 410 million in a bid to broaden its presence in the Southeast Asian region’s customer retailer sector. Sources close to the matter s...

Snapchat exploring options to bypass Apple’s upcoming privacy policies

Snapchat exploring options to bypass Apple’s upcoming privacy policies

By Akshay Kedari

Reportedly, American camera and social media company Snap Inc. is exploring different methods to circumvent Apple’s upcoming privacy regulations which will prohibit apps from collecting iPhone user information. Apple’s highly controversi...

SK Innovation might pull its battery business from the United States

SK Innovation might pull its battery business from the United States

By Akshay Kedari

SK Innovation Co., a South Korea-based petrochemical, energy, and e-mobility battery manufacturer, has recently announced its plans of withdrawing its battery operations from America if U.S. President Joe Biden fails to overrule a trade panel decisio...