Sundaram Finance Ltd (SFL) said it is taking steps to liquidate investments in the Alternate Investment Funds (AIF) schemes launched by Sundaram Alternate Assets Ltd. (SAAL) and Lok Capital Growth Fund which are covered under the circular issued by the RBI.
The company has an exposure of ₹270 crore, of which debt scheme of AIF is ₹205 crore and the equity portion is ₹65 crore, the leading NBFC said in a regulatory filing.
On December 19, RBI had directed Regulated Entities (RE) not to make investments in any scheme of AIFs which has downstream investments either directly or indirectly in a debtor company of the RE. Further, it asked RE to liquidate its investment in the scheme within 30 days from the date of such downstream investment by the AIF.
In order to comply with the RBI directions, SFL has taken suitable steps to liquidate the investments by transferring the same to identified prospective investors.
SFL’s investment in SAAL includes sponsor’s minimum contribution of ₹10 crore in debt funds and ₹26 crore in equity funds as required by SEBI (Alternative Investment Funds) Regulations, 2012.
SFL also clarified that the sponsor’s minimum contribution in the AIF schemes launched by SAAL cannot be liquidated, since it has to be maintained by it to comply with the SEBI (Alternative Investment Funds) Regulations, 2012.