Reliance Power Ltd, part of Anil Ambani-led Reliance Group, has asked the Securities and Exchange Board of India (Sebi) to immediately ban Edelweiss Financial Services Group from all capital markets and order an investigation into the sale of its pledged shares.
In a fresh letter dated on February 11, the company accused Edelweiss Group of an unwarranted sell-off of Reliance Power shares in the cash segment and in the futures market, which brought down the price of shares from Rs 27.20 to Rs 11.70 in just two trading days, a fall of an unprecedented 57 percent.
The letter, which is exclusively accessed by CNBC-TV18, accused that Reliance Power had raised resources by pledging their shareholding in the company from Edelweiss Group entities namely Edelweiss Special Opportunities Fund, Edelweiss Credit Opportunities Fund, Edelweiss Commodities Services Limited and ECL Finance Limited.
Later, IDBI Trusteeship Services was appointed as trustee for the Reliance Power shares. However, Edelweiss Group usurped the powers of the debenture trustee and illegally started selling shares of Reliance Power in the open market, commencing from 9.57 AM on February 4, 2018 and through to the end of business hours on February 5, 2019, the letter said.
The share sell-off of Edelweiss Group affected the 31 lakh shareholders of Reliance Power, which include Reliance Project Ventures and Management Private Limited, Reliance Wind Turbine Installators Industries Private Limited and Reliance Infrastructure Ltd, the company said. These three companies collectively hold 75 percent of shareholding in Reliance Power.
Further, the Reliance Power requested Sebi to declare all Edelweiss Group entities as not being 'fit and proper' persons and impose penalties or take action deemed appropriate.
Over 25 domestic and foreign financial institutions and banks including State Bank of India (SBI) have debt exposure of Rs 30,000 crore to Reliance Power.
First Published: Feb 12, 2019 6:37 PM IST
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