Auction for Reliance Capital now on 11 April; Torrent, Hinduja, Oaktree in fray
In a big boost to the insolvency resolution process of Reliance Capital, three bidders have agreed to participate in the second round of the auction, which has now been rescheduled for 11 April 2023 from 4 April.
The three bidders who have confirmed their participation in the second round of auction are IIHL of Hinduja Group, Torrent Investment, and Oaktree of Singapore.
According to sources, the auction has been postponed by a week to give more time to the two bidders — Torrent & Oaktree. Torrent had earlier refused to be part of the second auction.
“Earlier there was only one bidder — IIHL of Hinduja Group, which had confirmed its participation in the auction, but now with Torrent & Oaktree also onboard, the lenders have decided to give the bidders more time for preparation, as the competition has gone up,” said a source.
Another reason for delaying the auction is give more time for the bidders so that their resolution plans are compliant to the IBC. The lenders don’t want the repeat of auction held on 21 December, when plans of the bidders were found to be non-compliant.
“Bidders want the lenders & administrator to ensure that their plans, once submitted, should not fail the compliance test,” said the sources.
Committee of Creditors (COC) has also assured the bidders to consider their request that no bids outside the auction shall be considered. This will ensure value maximisation for the lenders and transparency in the bidding process.
Highest bidder in value (NPV terms) will be declared post auction to bring finality to the resolution process.
It must be noted that earlier all the bidders had shown reluctance to go ahead with the second round of auctions. Torrent Investments had conveyed to the lenders that the company was not willing to participate in the second round of auction, and IIHL of Hinduja Group has also told the lenders that it wanted to withdraw its post auction revised bid of Rs 9,000 crores and retain the old offer of Rs 8110 crores made in the first auction held on 21 December.
Cosmea Financial and Piramal, who had submitted binding bids for Reliance Capital in November Last year, also wanted the refund of their Earnest Money Deposit (EMD) of Rs 75 crores each, as both the companies did not wish to further participate in the ongoing resolution process of RCAP.
Also Read: Reliance Capital stares at liquidation as lenders pull out auction process
