In a significant move in the financial landscape, the Hinduja Group is currently engaged in discussions with private credit funds to secure funding of approximately $800 million. This substantial fundraise aims to support the potential acquisition of Reliance Capital, a development based on insights from individuals familiar with the matter. However, as negotiations are ongoing, the terms of the deal are subject to change.
Reliance Capital, a shadow bank formerly under the control of former billionaire Anil Ambani, faced a takeover by the central bank in 2021. This intervention followed a series of defaults by more than five prominent non-bank financiers within a short period, prompting regulatory action.
India’s financial sector has witnessed a surge in private credit activity in recent years, mainly due to local banking regulations that prohibit the extension of loans for mergers and acquisitions. The absence of this traditional lending route has spurred interest in private credit funds, making India a prime destination for such investments. Research by the Global Private Capital Association, a representative body of investors, revealed that the country has achieved the highest investment volume in Asia over the past five years.
The ongoing discussions between the Hinduja Group and private credit funds hold the promise of shaping the trajectory of the financial landscape. If successful, this collaboration could mark a significant step for the Hinduja Group in their pursuit of the acquisition, further underscoring India’s allure for private credit investments.
