Reliance Capital lenders extend plan submission date to August 10

Lenders Reliance Capital (RCap) have extended the deadline for submitting the company’s resolution plans by one month to August 10, after five leading bidders pulled out of the race. Although this is the fourth time the submission date has been extended, the process completion date remains unchanged.

The lenders, who met again on Friday to assess the progress of the insolvency proceedings, took the call to extend the date following requests from several existing bidders for “more time” to complete the due diligence process. within reason. Potential bidders also cited a lack of sufficient data to perform entity verification as part of the corporate insolvency resolution process (CIRP), sources close to the development said.

Under the previous plan, the last date by which potential bidders had to submit the resolution plan was July 11. This was itself an extension of the earlier June 20 deadline. However, the date for the completion of the company’s resolution process would be November 2 decided earlier, they added.

Creditors of the former Anil Ambani Group company are claiming Rs 23,666 crore in dues.

Earlier on June 26, five prominent bidders for RCap’s assets withdrew from the race. Currently, only five bidders, including Piramal Enterprises, are actively pursuing the process.

This contrasts with the nearly 54 Expressions of Interest (EOIs) the former Anil Ambani Group company had received in March.
The latest to pull out of the process were private equity firm Blackstone, HDFC Ergo, insurance companies ICICI Lombard and Tata Group and the Adani Group. Tata AIG General Insurance Company, a subsidiary of Tata Sons, had previously raised interest in buying RCap’s general insurance arm.

Besides Piramal Enterprises, potential candidates for resolution (PRA) that are actively engaged with the administrator are Yes Bank and Torrent Group. In addition, Zurich Insurance has expressed interest in RCap’s property and casualty insurance cluster and Cholamandalam Group for its life insurance cluster.

According to the Request for Resolution Plan (RFRP), bidders have two options – either to bid for all of the company’s assets or for one or more of its clusters (subsidiaries). The subsidiaries are Reliance General Insurance, Reliance Nippon Life Insurance, Reliance Asset Reconstruction Company, Reliance Securities, Reliance Commercial Finance and Reliance Home Finance.

On November 29, 2021, RBI replaced RCap’s board following defaults and governance issues, and appointed an administrator for the bankruptcy process. Later in April, Credit Suisse and Axis Bank – two lenders to RCap – dragged the indebted company to the National Company Law Tribunal (NCLT), seeking to recover debts worth Rs 760 crore. In February this year, the administrator invited EoIs to sell the assets of RCap.

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