A Piramal group-led consortium, IndusInd International, Oaktree Capital and Cosmea Financial are among resolution applicants actively considering a bid for Reliance Capital as an entire company, said two people aware of the development.
Reliance Capital’s administrator Nageshwara Rao Y has given potential applicants a choice to either bid for the entire company or submit plans for individual subsidiaries.
Advent International is actively considering the submission of a plan for both the life and non-life insurance businesses, the people said.
and True North Fund are likely to make separate bids for the life insurance unit, while Blackstone and Zurich Insurance are likely to bid separately for the general insurance arm, the same people said. “Although the administrator is yet to receive resolution plans, he has drawn up a list of investors showing active interest in the bankrupt company,” said one of the persons cited above.
The Piramal group and Oaktree declined to comment. The administrator did not respond to ET’s queries. True North, Yes Bank, Cosmea, Advent, Zurich International, IndusInd International and Blackstone could not be reached for comment.
The committee of creditors has extended the deadline for receiving resolution plans to August 12 from July 31. Those that have already submitted resolution plans can revise them until September 11, said a third person aware of the development.
The administrator received 54 expressions of interest (EoIs), including applications for Reliance Capital as an entire company and individual units. The Anil Ambani-founded company, which houses about 20 financial services companies and five associate companies, was admitted to insolvency proceedings in December. It is estimated that about 90% of recoveries will come from Reliance Nippon Life Insurance, in which Reliance Capital has a 51% stake, and Reliance General Insurance, a 100% subsidiary. Reliance Asset Reconstruction Co and Reliance Securities are among the other units in which investors have shown interest.
Sam Ghosh, founder promoter of Cosmea Financial Holdings, was heading Reliance Capital for almost nine years until 2017. The Piramal-led consortium includes two funds (APAC Investment IV Ltd and APAC Investment VII Ltd), India Resurgence Fund and PEL Finhold Pvt.
The administrator has verified claims of Rs 23,666 crore from financial creditors. The highest claim is from Life Insurance Corporation of India, followed by Yes Bank.
Although lenders are proceeding with the sale of Reliance Capital, some investors fear that the process may get hindered if the share pledge of Reliance General Insurance (RGI) is not released by the debenture trustee, as reported by ET on June 27. Reliance Capital had pledged shares of RGI as security to raise bonds to finance its group companies. The debenture trustee, IDBI Trusteeship, which is the custodian of the RGI shares, has indicated that it does not have permission from the debenture holders to release pledged shares of RGI.
