The deadline for submission of resolution plan for debt-ridden Reliance Capital may be extended further as bidders have sought more time to complete the due diligence process, sources said.
Few bidders, including Piramal, Torrent, Oaktree and IndusInd Bank, have written to the administrator seeking an extension of the deadline from existing August 10 to September 15.
Reliance Capital resolution plan submission date has already been extended four times in the past. The original date for submission was May 26.
The Committee of Creditors (CoC) will be meeting in the coming week to take stock of the resolution process of Reliance Capital and consider the deadline extension.
Reliance Capital Ltd (RCL) had initially received 54 Expression of Interest (EOI), but now only 5-6 bidders are active at the due diligence stage.
Due to poor response to the Reliance Capital resolution exercise, the CoC has also waived off the condition of paying Rs 75 crore Earnest Money Deposit (EMD), in the first submission date.
Moreover, sources said, one of the bidders Piramal Group is also facing roadblock as insurance regulator IRDAI has expressed concerns over the Group’s bid for the Reliance Nippon Life Insurance.
As per the regulations, Piramal, which already has a promoter stake in a life insurance firm, cannot pick up a similar stake in another life insurer. Pramerica Life Insurance Limited (PLIL) is promoted by Piramal Group.
According to sources, CoC and administrator are more keen on receiving bids under Option-1 i.e. for the Reliance Capital as a CIC (Core Investment Company).
Under Option-2, bidders can bid for 8 different businesses/clusters of RCL, including general insurance, life insurance, asset reconstruction and securities business.
The Reserve Bank of India (RBI) had on November 29 last year superseded the board of RCL in view of payment defaults and serious governance issues.
The RBI appointed Nageswara Rao Y as the administrator in relation to the Corporate Insolvency Resolution Process (CIRP) of the company.
This is the third large Non-Banking Financial Company (NBFC) against which the central bank has initiated bankruptcy proceedings under IBC recently. The other two were Srei Group NBFC and Dewan Housing Finance Corporation (DHFL).
RBI subsequently filed an application for initiation of CIRP against the company at the Mumbai bench of the National Company Law Tribunal (NCLT).
In February this year, the RBI-appointed administrator had invited expressions of interest for sale of Reliance Capital.