The lenders to Reliance Capital (RCap) have decided to extend the deadline for completion of the firm’s resolution process by another two months to November 2. The deadline for submitting resolution plans has been extended to July 11 from June 20.
The move follows a cold response from prospective bidders, even as certain bidders had sought “more time” to complete due diligence procedures. The decision to extend the deadlines was taken by the committee of creditors (CoC) at its meeting on Thursday, sources close to the development said.
This is the second extension for completion of the RCap resolution process. The earlier deadline, according to the Insolvency and Bankruptcy Code (IBC), to complete the process by June 3 was stretched by 90 days to September 2.
Separately, the CoC also decided to extend the last date for prospective bidders to submit the resolution plan to July 11 from June 20. Creditors to the former Anil Ambani group company were seeking Rs 23,666 crore in dues.
Two prospective bidders, Piramal Enterprise and IndusInd Bank, have sought extension to the deadline as they needed more time to complete due diligence procedures. This was due to “insufficient data” to conduct verification of the entities which are under the corporate insolvency resolution process (CIRP), sourced had told FE earlier this month.
While Piramal Enterprise wrote to the administrator seeking extension of the deadline to August 10, IndusInd Bank wanted it to be extended to July 15. Further, only three applicants – Yes Bank, besides Piramal Enterprise and IndusInd Bank – are actively engaged with the CoC for RCap’s resolution plans.
The CoC in May extended the deadline to submit the resolution plan to June 20 from May 26, following a poor response from bidders as only eight companies had shown interest. Of the eight prospective resolution applicants, only three – a consortium led by Piramal Group, Yes Bank and HDFC Ergo – were serious contenders.
The administrator to the resolution process received enquiries and clarifications from another five, while the remaining 46 PRAs went “incommunicado”.