Adani Finserve, ICICI Lombard, Nippon Life Insurance among bidders for Reliance Capital

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Adani Finserve, ICICI Lombard, Nippon Life Insurance among bidders for Reliance Capital

The 54 prominent firms that have expressed interest in the acquisition of debt-ridden Reliance Capital Ltd, promoted by the Anil Ambani Group, are Adani Finserve, ICICI Lombard, Tata AIG, HDFC Ergo and Nippon Life Insurance, according to sources. The last date for submission of bids for the debt-ridden firm was extended from March 11 to March 25 by the Reserve Bank-appointed administrator.

Sources said that Yes Bank, Bandhan Financial Holdings, Cholamandam Investment, OakTree Capital, Blackstone, Brookfield, TPG, KKR, Piramal Finance and Poonawala Finance are among the other bidders.

The deadline was extended on the request of some prospective bidders who had been trying to submit the Expressions of Interest EoI sources said. The Reserve Bank of India RBI had superseded the board of Reliance Capital Ltd RCL on 29 November last year due to payment defaults and serious governance issues. This is the third large non-banking financial company NBFC, against which the central bank has recently initiated bankruptcy proceedings under the Insolvency and Bankruptcy Code IBC. The other two were Srei Group NBFC and Dewan Housing Finance Corporation DHFL. A majority of the bidders have bid for the whole company, while the others have bid for one or more subsidiaries of RCL, according to the sources.

The bidders had two options - either they could bid for the entire RCL or one or more of Reliance Capital's subsidiaries. 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.

After the takeover of the board, the RBI appointed Nageswara Rao Y as administrator in relation to the Corporate Insolvency Resolution Process CIRP of the company. In February this year, the RBI-appointed administrator had invited expressions of interest EoIs for the sale of Reliance Capital after he filed an application for initiation of CIRP against the company at the Mumbai bench of the National Company Law Tribunal NCLT. In September, RCL informed shareholders that the company's consolidated debt was 40,000 crore, according to the annual general meeting of the company. It had reported a consolidated net loss of 1,759 crore in the quarter ended December 2021, but it had reported a narrowing of its consolidated net loss. In the same quarter a year ago, the company had posted a net loss of 3,966 crore.

Net loss was widened from 1,156 crore in the previous quarter of September 2021 to 1,156 crore. The company's total income was 4,083 crore in Q 3 FY22, down from 4,890 crore in Q 3 FY 21. RCL was incorporated on March 5, 1986 and is registered as the Non-Banking Financial Company Core Investment Company CIC Non-Deposit Taking Systemically Important NBFC-CIC ND-SI under the Reserve Bank of India Act, 1934.