NCLT asks CoC not to consider Hinduja group’s bid for Reliance Capital
The Mumbai bench of the National Company Law Tribunal (NCLT) has directed the committee of creditors (CoC) of Reliance Capital to not consider Hinduja group’s revised offer for the erstwhile Anil Ambani group company.
Torrent Group, which had emerged as the highest bidder in the e-auction on 21 December 2022, had moved NCLT against Hinduja group’s revised offer. Hinduja group revised its bid price for Reliance Capital to Rs 9,500 crore on 23rd December 2022, two days after the e-auction. Hindujas had earlier quoted Rs Rs 8,110 crore in the e-auction.
Torrent group emerged as the highest bidder in the e-auction with bid price of Rs 8,640 crore. As per its offer, Rs 4,000 crore is to be paid up front and the rest 55% bid price is being offered at zero interest to the lenders of Reliance Capital as deferred payment to be paid in three equal instalments in 3rd, 4th and 5th year.
As per Hindujas revised bid, they agreed to pay Rs 8,800 crore upfront.
It is believed that Reliance Capital lenders led by LIC and EPFO with 35% voting rights were in favour of a bid with higher upfront payment. Therefore, it was expected that Hindujas might have an edge over Torrent despite the latter emerging as the highest bidder in the e-auction.
Insolvencytracker.in had earlier reported that Reliance Capital received four binding bids on 28 November, which was the last date for submitting the bids. The highest bid of Rs 5,231 crore has been submitted by a consortium of Cosmea Financial and Piramal. Hindujas with Rs 5,060 crore has emerged as the second highest bidder, followed by Torrent Investment (Rs 4500 crore) and Oaktree (Rs 4200 crores).
However, Oaktree and the consortium of Cosmea-Piramal pulled out of the race citing different reasons. The Piraml consortium withdrew from the e-auction as it felt the base price (Rs 6,500 crore) was high and impractical.
Reliance Capital owes its lenders Rs 25,400 crore and the liquidation value of its assets has been arrived at Rs 13,000 crore.
Also Read: Hinduja Group ahead in the race to acquire Reliance Capital
After a transplant e bidding process, Hinduja has no right to revise . NCLT has given good decision to the COC.
Otherwise now hinduja came
Tomorrow other will come
If at all COC is not comfortable & the law permits, they can go for another transparent e bidding process