Adani, Tata AIG and ICICI Lombard Emerged as Front Runners for Reliance Capital

Adani Finserve, ICICI Lombard, Tata AIG, HDFC Ergo, and Nippon Life Insurance are among the 54 prominent firms that have expressed interest to acquire debt-ridden Reliance Capital Ltd, promoted by the Anil Ambani Group, sources said.

The last date for submission of bids for the debt-ridden firm had been extended to March 25 from March 11 earlier by the Reserve Bank-appointed administrator.

Other bidders include Yes Bank, Bandhan Financial Holdings, Cholamandam Investment, OakTree Capital, Blackstone, Brookfield, TPG, KKR, Piramal Finance and Poonawala Finance, sources said.

The deadline was extended on the request of some prospective bidders who had sought more time to submit the Expressions of Interest (EoI), sources said. The Reserve Bank of India (RBI) had on November 29 last year superseded the board of Reliance Capital Ltd (RCL) in view of payment defaults and serious governance issues.

This is the third large non-banking financial company (NBFC) against which the central bank has initiated bankruptcy proceedings under the Insolvency and Bankruptcy Code (IBC) recently. The other two were Srei Group NBFC and Dewan Housing Finance Corporation (DHFL).

According to the sources, a majority of the bidders, who have submitted EOIs, have bid for the entire company, while the others have bid for one or more subsidiaries of RCL.

The bidders had two options - either they could bid for the entire RCL or any one or more than one of the subsidiaries of Reliance Capital.

Reliance Capital's subsidiaries include Reliance General Insurance, Reliance Nippon Life Insurance, Reliance Securities, Reliance Asset Reconstruction Company, Reliance Home Finance and Reliance Commercial Finance.

Following the takeover of the board, the RBI appointed Nageswara Rao Y as the administrator in relation to the Corporate Insolvency Resolution Process (CIRP) of the company.

RBI subsequently filed an application for initiation of CIRP against the company at the Mumbai bench of the National Company Law Tribunal (NCLT).

Earlier in February this year, the RBI-appointed administrator had invited expressions of interest (EoIs) for sale of Reliance Capital.

In September, RCL in its annual general meeting (AGM) had informed shareholders that the company's consolidated debt was Rs 40,000 crore. It had reported narrowing of its consolidated net loss to Rs 1,759 crore in the quarter ended December 2021.

The company had posted a net loss of Rs 3,966 crore in the same quarter a year ago. However, net loss widened from Rs 1,156 crore in the preceding quarter ended September 2021.

Total income of the company stood at Rs 4,083 crore in Q3FY22, down from Rs 4,890 crore in Q3FY21.

RCL was incorporated on March 5, 1986 and is registered as Non-Banking Financial Company Core Investment Company (CIC)-Non-Deposit Taking Systemically Important (NBFC-CIC-ND-SI) under the Reserve Bank of India Act, 1934.