Due to a tepid response from bidders for the acquisition of debt-laden Reliance Capital, the company’s lenders on Sunday decided to extend the timeline for the resolution process by another two months ending November 2, 2022. This would be the second extension by the Committee of Creditors (CoC) for the Anil Ambani-backed company’s resolution.
Earlier, the creditors extended the timeline by 90 days to September 2, 2022, from June 3. Notably, the administrator had to close Reliance Capital’s resolution within 180 days by June 3, as per the Insolvency and Bankruptcy Code (IBC) rules.
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Further, the creditors also decided to extend the deadline for submission of the resolution plan by the prospective bidders to July 11 from June 20 this year.
The deadline for the resolution plan submission has been extended as a few prospective bidders had written to the administrator seeking more time for the submission.
Piramal Enterprises had asked the deadline to be extended to August 10, while IndusInd Bank had asked for the timeline extension to July 15.
The timelines for resolution process completion and resolution plan submission have been extended due to the cold response from the bidders. Notably, from around 54 expressions of interest (EoI) received initially only a handful of bidders are engaged with the administrator.
They also pointed out that the lenders had given only two options to the bidders. Firstly, bidders were allowed to acquire Reliance Capital along with its eight subsidiaries.
Companies like Piramal Enterprises, Yes Bank, and Torrent Group have opted for the first option. “Secondly, bidders can also submit resolution plans even for a single subsidiary.” In the previous para which ends as ‘eight subsidiaries’.
Under the second option, for the company’s general insurance cluster, Zurich Insurance has shown interest, while Cholamandalam Group was interested in the Life Insurance arm. RBI- appointed Nageswara Rao Y is the administrator of Reliance Capital’s Corporate Insolvency Resolution Process (CIRP).
