Get all your news in one place.
100’s of premium titles.
One app.
Start reading
Livemint
Livemint
Business
Livemint

Reliance Capital lenders finalise RFRP for bidders; approval expected next week

Reliance Capital has a consolidated debt of about ₹40,000 crore.

Lenders of debt-ridden Reliance Capital Ltd (RCL) have decided upon the Request for Resolution Plan (RFRP) document and it will be placed before them for final approval next week.

The RFRP document sets the guidelines for the submission and evaluation of the resolution plan and is shared with all the companies which have submitted Expression of Interest (EoI) for the submission of financial bids.

The Reserve Bank of India (RBI) had on November 29 last year superseded the board of Reliance Capital Ltd in view of payment defaults and serious governance issues.

RBI-appointed Nageswara Rao Y is the administrator of Reliance Capital's Corporate Insolvency Resolution Process (CIRP).

The company is the third NBFC to go for resolution under the IBC after Dewan Housing Finance (DHFL) and Kolkata-based Srei Group. The other two were Srei Group NBFC and Dewan Housing Finance Corporation (DHFL).

RCap has a consolidated debt of about 40,000 crore. RBI had applied to initiate CIRP against the Reliance Group company at the National Company Law Tribunal (NCLT) Mumbai bench.

The RFRP was approved by the Committee of Creditors (CoC) of RCL in its meeting held on Wednesday, sources said. The document will be placed before the CoC for final approval next week.

As per the RFRP, sources said, the consortium cluster bidders have to submit bids on an all-cash basis, but it gives an option to the bidders at the company level to put in bids either on an all-cash or deferred payment basis.

The CoC has also decided to seek 3 months' extension for the completion of the the CIRP, news agency PTI reported. The voting on the proposal will take place in next week's meeting.

Post the 90 days extension, the resolution needs to be completed by September 3.

The RFRP will reduce competition as no single company can bid for an individual cluster like Reliance General Insurance or Reliance Life Insurance.

Key clusters of RCL are Reliance General Insurance, Reliance Health Insurance, Reliance Nippon Life Insurance, Reliance Asset Reconstruction, and Reliance Securities.

During the meeting, as per a statement by RCL, the administrator appraised the CoC about the status of claims, status of CIRP process, RFRP document, going concern operations of the company, filing of extension of 90 days and the way forward in terms of the activities as stipulated under the Insolvency and Bankruptcy Code (IBC).

The RBI subsequently filed an application for initiation of CIRP against Reliance Capital at the Mumbai bench of the National Company Law Tribunal (NCLT). In February this year, the RBI-appointed administrator invited expressions of interest (EoIs) for the sale of Reliance Capital.

Subsidiaries of Reliance Capital under insolvency resolution are - Reliance General Insurance, Reliance Nippon Life Insurance, Reliance Securities, Reliance Asset Reconstruction Company, Reliance Home Finance, and Reliance Commercial Finance.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.