Why did Yes bank took over Reliance Centre headquarters for 1200 Crores

There was a recent news where the headquarters of Reliance ADAG group which was headed by Anil Ambani, the Reliance Center, Santacruz, Mumbai was sold to Yes Bank for INR 1,200 crores. Let’s look at the reason and the details for the sale of Reliance’s headquarters.

What is Reliance Infrastructure
What is Reliance Centre
Why did Yes bank took over Reliance Centre
Sale of the Reliance Centre
FAQ

What is Reliance Infrastructure

Reliance Infrastructure is a Indian-based private sector company. The company was involved in power generation, infrastructure defense, and construction. The company is part of the Reliance Anil Dhirubhai Ambani group.

The company has undertaken a lot of projects which include power plants, metro rails, airports, toll roads, bridges, and defense. The company has a major shareholding in Reliance Power and Reliance Naval and Engineering Limited.

Reliance Infrastructure was ranked as the 51st largest corporation in Fortune India's 500 lists of 2019 and it had the 1st rank in the category of Infrastructure Development.

Reliance Infrastructure came into existence when it took over an eighty three year old company which was undertaken by the Government which was known as Bombay Suburban Electric Supply (BSES) in the year 2002.

Reliance Infrastructure was formerly known as Reliance Energy Limited.

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What is Reliance Centre

Reliance Infrastructure which is part of Anil Ambani’s group has sold its headquarters to Yes Bank. The amount of the sales is expected to be INR 1,200 crores. The headquarters is located in Mumbai’s Santacruz.

Reliance Center is a building with high technology office. The building has an area of 695,000 square feet on a plot of 15,514 square meters of land. Anil Ambani had shifted to this office after he had moved out of Reliance’s Ballard Estate Office.

The experts in the field of Real Estate have that the office has a prime location because the Reliance Center is close to Mumbai’s Western Express Highway.

Other than this, the office just has a 15-minute drive to Chhatrapati Shivaji International Airport Terminal that is T2 and a 10-minute drive to the Chhatrapati International Airport Domestic Terminal that is T1. The building is a stone’s throw from the Bandra-Kurla Complex business district in Mumbai.

Why did Yes bank took over Reliance Centre

Reliance’s ADAG group which is headed by Anil Ambani is expected to have an exposure of INR 4,000 crores which it has to pay to Yes Bank. Last year, Yes bank had said that last year it had issued a demand notice to the ADAG group to pay the borrowed amount of INR 2,892 crores.

The demand notice was sent under the SARFAESI ( Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest) Act. The dues had to be paid back by 60 days from the issue of the demand notice.

Reliance’s ADAG group had failed to pay the dues on time and Yes bank had announced that it was going to take the possession of the building due to non-payment of loans which amounted to INR 2,892 crores.

It is said that Yes bank had taken possession of the building looking at the Mumbai Airport. With this project, the Reliance Infrastructure has closed 3 different transactions which include the sale of assets. These transactions had taken place in the last 90 days.

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Sale of the Reliance Centre

Recently Reliance Infrastructure and Yes Bank announced that they were getting in to a sale transaction where the Reliance Centre, Santacruz, Mumbai will be sold to Yes Bank. Yes Bank which currently operates its business from One Indiabulls center in Central Mumbai is planning to convert the Santacruz office to its Corporate Head Office.

An official from the company has said that with the sale of Reliance Center, Santacruz, Mumbai Reliance Infrastructure’s debt exposure to YES Bank has been reduced. The debt exposure of INR 2,000 crores from INR 4,000 crores has been reduced.

FAQ

What is the net worth of Anil Ambani in 2020?

As per the reports declared before a UK court in February 2020 that his net worth is zero and he is bankrupt.

What does Anil Ambani owns?

Reliance Infrastructure which is an Private Sector Enterprise managing power, defense, construction and infrastructure and Reliance Power.

How many companies Mukesh Ambani have?

Mukesh Ambani has 7 companies that are, Reliance Retail, Reliance Life Sciences, Reliance Jio Infocomm Limited, Reliance Petroleum, Network 18, Reliance Industrial Infrastructure Limited, and Football Sports Development Limited.

Conclusion

Yes Bank has said that the value of the transaction of the building is expected to be INR 1,200 crores and the entire amount from the sale of Reliance Center, Santacruz, Mumbai is utilized only to pay the debt it owes to Yes Bank. The company official has said that the company is planning to be a debt-free company within 2021.