Reliance Capital (RCap) lenders may consider extending the deadline to complete the resolution process until May 30 this year, the sources said.
The current term ends on April 16.
Considering that the second round of the auction has not yet been carried out, it is not possible to conclude the resolution process within the current deadline.
Earlier this week, the lenders postponed the second auction until April 11.
The deadline to complete the RCap resolution process has been extended several times in the past.
On the other hand, the sources said, the three bidders: Hinduja Group's IndusInd International Holdings Ltd (IIHL); Singapore-based Torrent Investment and Oaktree, which will participate in the expanded challenge mechanism (second round of auction), are still engaged with the Creditors Committee (CoC) on certain issues or concerns raised by them.
Bidders' primary concern is compliance with resolution plans under the Insolvency and Bankruptcy Code (IBC) and Resolution Plan Request (RFRP) guidelines, since in the first round of auctions, the company's bid Hinduja Group was introduced after the auction.
This post-auction bidding date is being challenged by Torrent Investment in the Supreme Court, as it was the highest bidder based on the auction.
Therefore, the sources said, this time the bidders want compliance with resolution plans as per IBC and RFRP guidelines, before participating in the second round of auction.
The suitors are also seeking more transparency from the CoC on the expanded challenge mechanism and have demanded that a separate website be created on the expanded challenge mechanism.
Sources have indicated that the second round of the auction, scheduled for April 11, is likely to be postponed for another week, until all issues raised by bidders are resolved to their satisfaction.
Reliance Capital's second round of auctions has been postponed twice in the past due to litigation. The first auction round was held on December 21, 2022.
Earlier, a dispute over RCap's bid arose when Hindujas offered to pay Rs 9 billion in cash upfront to lenders, one day after the first round of auction concluded on December 21.
Following this, the lenders decided to hold one more auction round to maximize their recovery from the RCap assets.
The Reserve Bank of India (RBI) on November 29, 2021, replaced the RCap board in view of payment defaults and serious governance issues. RBI appointed Nageswara Rao Y as administrator in connection with the company's Corporate Insolvency Resolution Process (CIRP).
Reliance Capital is the third large non-bank financial company (NBFC) against which the central bank has initiated bankruptcy proceedings under IBC.
The other two were Srei Group NBFC and Dewan Housing Finance Corporation (DHFL). The central bank subsequently filed a CIRP initiation application against the company in the Mumbai court of the National Company Law Tribunal.
(This story has not been edited by Devdiscourse staff and is automatically generated from a syndicated feed.)
