In stock exchange filings, RIL said 99.99% of shareholders, who participated in the meeting held through video conferencing, voted in favour of the resolution.

As per directions of the National Company Law Tribunal (NCLT), the company convened meetings of equity shareholders, lenders and unsecured creditors for consideration of a resolution for transferring the O2C business to a separate subsidiary – Reliance O2C Limited.

While 100% of the secured creditors voted in favour of the resolution, 99.99% of unsecured creditors cast their vote in favour of the resolution.

“Scheme of Arrangement between Reliance Industries Limited (Transferor Company) and its shareholders and creditors and Reliance O2C Limited (Transferee Company) and its shareholders and creditors was placed before” equity shareholders, secured and unsecured creditors for consideration and approval, the filings said.

In February, RIL had announced the contours of spinning-off its oil refining, fuel marketing and petrochemical (oil-to-chemical) business into an independent unit with a $25 billion loan from the parent, as it looked to unlock value by settling stakes to global investors like Saudi Aramco.

The carving out of Reliance O2C Limited (O2C) will enable the focused pursuit of opportunities across the oil-to-chemicals value chain, improve efficiencies through self-sustaining capital structure and a dedicated management team, and attract dedicated pools of investor capital, according to a company presentation.

The transfer of twin refineries at Jamnagar in Gujarat, petrochemical sites in multiple states, and a 51% stake in the fuel retailing business to O2C will be on a ‘slump sale basis’, subject to requisite approvals that are expected to come in by September.

However, upstream oil and gas producing fields such as KG-D6 and the textile business will not form part of the new unit, where it aims to maintain a significant majority stake.

The consideration for the transfer will be in the form of long-term interest-bearing debt of $25 billion to be issued by O2C to Reliance Industries Ltd (RIL). RIL’s external debt is proposed to remain with RIL only.

Once completed, RIL will house only the upstream oil and gas exploration and production business, financial services, group treasury and legacy textile businesses, and act as a holding company of the group.

Long-dated loans issued by O2C to RIL, as part of the reorganisation, will provide an efficient mechanism to upstream cash generated from O2C to RIL, the presentation said.

RIL has been in ongoing discussions with Saudi Arabian Oil Company (Saudi Aramco) to sell a minority 20% stake in its O2C businesses, which, if successful, should lead to further deleveraging of the company.

https://www.livemint.com/companies/news/ril-gets-shareholders-creditors-nod-to-hive-off-o2c-business-into-separate-unit-11617356124154.html