Hinduja Group needs DPIIT nod, too, for Reliance Capital buy
Hinduja Group received the central bank's approval to acquire the financial services company, but the transaction cannot proceed until it is approved by the Department for Promotion of Industry and Internal Trade (DPIIT).
The Hindujas need DPIIT's approval because IIHL (IndusInd International Holdings), the acquisition vehicle, has 600 shareholders from the UAE, Singapore, Hong Kong, and Mauritius, with 39 shareholders residing in Hong Kong, which is classified as a land-border country under PN3 due to its special administrative relationship with China, said a source.
This has raised compliance questions under PN3, prompting deeper scrutiny by Indian regulators.
The approval is critical for the Hinduja Group, which is working round the clock to close the transaction by November 30 (the long stop date for the deal), failing which it will have to return the ₹3,000 crore raised from institutions, high-net-worth individuals (HNIs), ultra-HNIs, and family offices including Aditya Birla Capital, Tata Capital and 360 One, for the acquisition of RCap.
A Hinduja spokesperson did not respond to requests for comment.
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