Reliance ARC to acquire Rs250 cr in bad assets

Reliance ARC to acquire Rs250 cr in bad assets

New Delh: Reliance Capital promoted Reliance Asset Reconstruction Company, which started its operations recently, expects to acquire bad assets of about Rs250 crore in the next six months.

“So far we have got little but we expects to acquire stressed assets to the tune of Rs250 crore by March 2009," Reliance Capital Chief Executive Officer Sam Ghosh said.

The company is in talks with the some entities for taking over stressed assets, he said, adding, the average ticket size of acquisition would be about 20crore.

Ghosh said the company has adopted a buyer driven model for acquisition of NPAs (individual as well as portfolio cases) in cash.

The company would prioritise larger cases requiring restructuring or strategic sale envisaging funds (including equity) infusion for revival at the borrower level, he said.

Reliance Capital holds 49% stake in Reliance Asset Reconstruction Company, which started operation with an initial investment of Rs100 crore.

The company’s three local partners hold 31% stake. Indian Bank and Corporation Bank have 11.5% stake each while re-insurance major GIC holds 9%.

The other prominent investors are George Soros and Blue Ridge, which hold 9.5% each in the company.

At present, Asset Reconstruction Company India (Arcil) is the the largest asset reconstruction company with assets under management of over Rs8,000 crore.

Arcil is promoted by State Bank of India, IDBI and Punjab National Bank.