Reliance Cap okays 5:100 Ventures swap

The Reliance Capital board today approved a 5:100 swap ratio for merger of Reliance Capital Ventures with itself. It means shareholders of Reliance Capital Ventures will get 5 shares of Reliance Capital for every 100 shares held.

The Anil Dhirubhai Ambani Group, promoters of both the companies, said in a media statement that the merger would see 23 lakh Reliance Industries shareholders holding shares of Reliance Capital directly.

In addition, the merger has eliminated the dual listing of Reliance Capital and Reliance Capital Ventures.

The proposed share exchange ratio is based on the number of shares of Reliance Capital Ventures in Reliance Capital. It is also recommended by the leading international firm, KPMG.

The shares of Reliance Capital Ventures in Reliance Capital will be cancelled, post merger. The fully diluted equity capital of Reliance Capital will remain at approximately Rs 245 crore.

The merger would also increase liquidity for all Reliance Capital shareholders and would create wider domestic and international shareholder base for Reliance Capital, the media statement said.

Reliance Capital Ventures are among the four resulting companies being created due to division of the Reliance empire between the Ambani brothers- Mukesh and Anil.

Reliance Industries' shares in Reliance Capital were transferred to Reliance Capital Ventures to demerge Reliance Industries from Reliance Capital.

Reliance Energy board will meet tomorrow to consider a similar merger proposal of Reliance Energy Ventures with itself.

Anil Ambani had earlier indicated that shareholders of Reliance Energy Ventures would get seven shares of Reliance Energy for every 100 shares they held.

Reliance Capital ranks among the top three private sector financial services and banking companies, in terms of net worth.

It is into interests in asset management and mutual funds, stock broking, life and general insurance, proprietary investments and private equity.