Reliance Capital gets 54 Prominent Bidders
Reliance Capital has a consolidated debt of Rs 40,000 cr.
The company has reported narrowing its consolidated net loss to Rs 1,759 crore in the quarter ended in December 2021. RBI said that the company would go for insolvency proceedings shortly. This is the third large non-banking financial company (NBFC) against which the central bank has initiated bankruptcy proceedings under the Insolvency and Bankruptcy Code (IBC).
The company had said it was in the process of meeting its obligations by way of time-bound monetization of its assets. But, they failed to meet two deadlines. The debenture holders of the company had, in October 2020, sought Expression Of Interest (EOI) for submission of asset monetization plans for certain subsidiaries and investments of the company.
The bidders could bid for the entire company or one or more subsidiaries. The majority of the bidders, who have submitted EOIs, have bid for the entire company while the others have bid for one or more subsidiaries of RCL. As many as 54 companies including Adani Finserv, ICICI Lombard, Tata AIG, Bandhan Financial Holdings and OakTree Capital have submitted expressions of interest for debt-ridden Reliance Capital or some of its subsidiaries, as part of the resolution process.
RBI appointed Nageswara Rao Y as the administrator of the Corporate Insolvency Resolution Process (CIRP) of the company. An application was filed for initiation of CIRP against the company at the Mumbai bench of the National Company Law Tribunal (NCLT). The Reserve Bank of India (RBI) had on November 29 last year superseded the board of Reliance Capital Ltd (RCL) because of payment defaults and serious governance issues.
The Administrator and the creditors may give greater weightage to the first option of selling all assets together. Reliance Capital’s subsidiaries include Reliance General Insurance, Reliance Nippon Life Insurance, Reliance Securities, Reliance Asset Reconstruction Company, Reliance Home Finance and Reliance Commercial Finance.
The last date for submission of bids for the debt-ridden firm had been extended to March 25 from March 11 earlier by the Reserve Bank-appointed administrator.
