Reliance Capital insolvency resolution period extended by 60 days
The Mumbai bench of the National Company Law Tribunal has extended the corporate Insolvency Resolution Process (CIRP) period Reliance Capital by 60 days. Now, the CIRP process is supposed to get over by 1 November 2022.
The company informed the exchanges on 26 August 2022.
The application for extension of the period was filed by the Administrator of Reliance Capital seeking exclusion of a period of sixty days from the timelines prescribed for completion of the Corporate Insolvency Resolution Process. The applicant had argued that the said exclusion is required to be granted since there were various litigations which consumed most of the time; hence, this exclusion is required to complete the CIR Process.
The administrator of Reliance Capital received 54 applications from potential resolution applicants, but only 5-6 applicants are said to be showing interest in the submission of resolution plans. Recently, the committee of creditors granted the fifth extension of the deadline for submission of resolution plans as bidders sought more time to complete the due diligence process.
Due to poor response from resolution applicants, the CoC has also waived off the condition of paying Rs 75 crore Earnest Money Deposit (EMD) in the first submission date.
All big names including Tatas, Adani Finserv, ICICI Lombard, and Nippon Life Insurance, HDFC Ergo, OakTree Capital, Yes Bank, Bandhan Financial, Cholamandalam Investment, Blackstone, Piramal, etc had responded to the EoI.
The bidders could either bid for the entire assets of Reliance Capital or any one or more of its subsidiaries. Its subsidiaries include Reliance General Insurance, Reliance Nippon Life Insurance, Reliance Asset Reconstruction Company, Reliance Securities, Reliance Commercial Finance and Reliance Home Finance.
Reliance Capital has a consolidated debt of about Rs 38,000 crore, with nearly Rs 25,000 crore of claims admitted by the administrator. The Reserve Bank of India (RBI) In November has superseded the board of Anil Ambani’s Reliance Capital over defaults in payments and serious governance concerns.
RBI had appointed Nageswar Rao Y, the former executive director, Bank of Maharashtra, as the Administrator of the company. Reliance Capital is the third NBFC firm against which insolvency proceedings have been initiated. The others are Srei Group NBFCs and Dewan Housing Finance Corporation (DHFL).
Also Read: 54 firms submit EoI for acquiring Reliance Capital; Tatas, Adanis among bidders
