Reliance Capital share price plunged in trade today amid reports that the Reliance Group firm is exiting the mutual funds business. Reliance Capital share price fell up to 24% to Rs 30.40 compared to previous close of Rs 40 on BSE. It closed 20% lower at Rs 32 on BSE today. Reliance Capital share price has been losing for the last four days and fallen 31.92% in the period. Reliance Capital share price has fallen 92.83% during last one year and lost 85.95% since the beginning of this year.
The small cap stock logged market capitalisation of Rs 813.72 crore on BSE today.
Anil Ambani-owned Reliance Capital is exiting the mutual fund business by selling its entire stake in Reliance Nippon Life Asset Management (RNAM) to pare debt.
Reliance Capital will sell its entire 42.88% stake in RNAM to Nippon Life Insurance of Japan and other financial investors in the joint venture.
Reliance Capital said it would receive proceeds of about Rs 6,000 crore ($860 million) by selling its stake. It will use the entire amount to reduce its outstanding debt by 33%.
Nippon Life Insurance of Japan floated an open offer to acquire nearly 22.49 percent stake in Reliance Nippon Life Asset Management (RNAM) for Rs 3,179 crore under a deal with Reliance Capital which is exiting the mutual funds business.
With the closure of open offer, Nippon Life Insurance stake in Reliance Nippon Life Asset Management (RNAM) rose to 54 percent. The open offer was part of the stake sale process.
The mandatory open offer tendering period was from July 23 to August 5, sources said, adding that approximately 11 percent shares were tendered in the open offer.
Nippon Life paid Rs 230 per share in the open offer and the total pay-out was about Rs 1,500 crore and the company has now become the majority shareholder with 54 percent stake in RNAM.
Edited by Aseem Thapliyal