SEBI Asks Two Religare Firms To Recover Loans Worth Rs 2,300 Crore From Singh Brothers, 21 Others
SEBI said funds amounting to Rs 2,315 crore had been diverted from the books of Religare Finvest.
The Securities and Exchange Board of India ordered Religare Finvest Ltd. and Religare Enterprises Ltd. to recall loans worth over Rs 2,300 crore that were diverted to promoters Shivinder Mohan Singh, Malvinder Mohan Singh and 21 other entities after finding preliminary evidence of fund diversion.
Religare Finvest is a subsidiary of Religare Enterprises. At the end of December, the Singh brothers were among the promoters of Religare Enterprises.
“It was observed that funds amounting to Rs 2,315.09 crore had been diverted from the books of Religare Finvest for the utilisation of promoters and promoter group entities of Religare Enterprises,” the regulator said in an order.
Noting that a detailed investigation of the fund diversion is necessary to find out the role of each entity in the alleged routing of funds, the market regulator said remedial action needs to be taken to protect the interest of shareholders.
The regulator has directed the two companies to “initiate steps to recall all the loans amounting to Rs 2,315.09 crore” along with due interest within three months.
Besides, the Singh brothers have been asked not to associate themselves with the affairs of Religare Enterprises and Religare Finvest till further directions.
SEBI said that prima facie, the role of Religare Finvest and Religare Enterprises in the alleged diversion of funds to entities related to the latter’s promoters—RHC Holding and ANR Securities—for the ultimate benefit of Shivi Holdings Pvt. Ltd, Malav Holdings Pvt. Ltd., Shivinder Mohan Singh and Malvinder Mohan Singh has been established.
Further, the watchdog said non-disclosure of funds routed by Religare Finvest through unrelated entities for the benefit of promoters and promoters group entities in the books of the company was to circumvent listing norms.
Apart from the Singh brothers, the loans have to be recalled from 21 other entities.
The other entities are:
- OSPL Infradeal
- Bharat Road Network
- Platinum Infrastructure
- Ad Advertising
- Artifice Properties
- Best Health Management
- Devera Developers
- Vitoba Realtors
- Fern Healthcare
- Modland Wears
- Rosestar Marketing
- Star Artworks
- Tripoli Investment & Trading Co
- Volga Management and Consultancy
- Zolton Properties
- Religare Comtrade
- RHC Holding
- ANR Securities
- Shivi Holdings
- Malav Holdings.
The markets regulator had received complaints of alleged financial mismanagement and fund diversions at Religare Finvest for the benefit of promoter group entities of Religare Enterprises.