Reliance Capital auction gets new twist with Hinduja bid (Representative Image)
Photo: PTI
โOne of the applicants for the resolution, in complete contempt of the sanctity of the challenge process, has attempted to revise the offer amount cited by him during the challenge mechanism process, in an attempt to illegally increase the amount of his offer. offer beyond the allowed time period,โ it said in a note. โThis is a clear violation of the rebuttal process memo,โ he added.
Hinduja Group, after making an earlier offer of Rs 8,110 crore and exiting the bidding process, raised the offer to Rs 9,400 crore after closing. All auction participants submitted their bids on Thursday. The CoC opened the bids on Friday at a meeting.
Lenders will now call whether to accept Hinduja's renewed offer, submitted after the process was officially finalized on Wednesday.
Hinduja's new offer includes a payment of Rs 8.8 billion by Reliance Capital's lead investment firm which owns 20 entities ranging from insurance to brokerage, according to an Economic Times report.
Hinduja's revised offer was still below the minimum liquidation value of Rs 13,000 crore, but resulted in a 37% recovery versus 35% for Torrent Investments' offer.
Kroll and Druff, the two companies appointed by the insolvency administrators to value the company, estimated the liquidation value to be in the range of Rs 12,500 to Rs 13,000 crore.
R Cap, owned by the Anil Dhirubhai Ambani group, was admitted to the debt resolution process in November 2020 after it defaulted on a loan worth Rs 24,000 crore. In November last year, the Reserve Bank of India replaced the board of directors of Reliance Capital and appointed Nageswara Rao Y as administrator in connection with the company's Corporate Insolvency Resolution Process (CIRP).
RBI subsequently filed a CIRP initiation application against the company in the Mumbai court of the National Company Law Tribunal (NCLT). In early February this year, the RBI-appointed administrator invited expressions of interest (EoI) for the auction.
In September, RCL at its annual general meeting (AGM) informed shareholders that the consolidated debt of the company stood at Rs 40,000 crore. It also reported a reduction of its consolidated net loss to Rs 1759 crore in the quarter ending December 2021.
The company had posted a net loss of Rs 3,966 crore in the same quarter of the previous year. However, the losses increased from Rs 1,156 crore in the previous quarter of September. The total revenue of the company stood at Rs 4,083 crore in the third quarter of FY22, up from Rs 4,890 crore in the third quarter of FY21. RCL was incorporated on 5 March 1986 and is registered as a Non Systemically Important Deposit Taking Principal Investment Bank (CIC) Non-Bank Finance Company (NBFC-CIC-ND-SI) under the Reserve Bank of India Act 1934.
