60 companies submit bids for Reliance Capital's asset monetisation

Oaktree, JC Flowers, 6 others submit EoIs for entire company

The sale of Reliance Capital’s (RCap’s) assets by Indian banks has received overwhelming response with eight companies – including Oaktree, JC Flowers and six asset reconstruction companies (ARCs) – submitting EoIs (expressions of interest) for the entire company.

Blackstone, KKR, and Bain Capital, among others, are in the race for its general insurance arm, and Bandhan Bank, Bain, and Dabur Investments have shown interest for RCap’s 51 per cent stake in the life insurance business.

In total, the lenders’ advisors – SBI Capital Markets and JM Financial – have received over 60 different bids for the assets. The companies that have shown interest will now be given access to the company’s data room and will then be asked to submit their financial bids for the firm or its assets.

Interestingly, in the ongoing sale of DHFL, 24 companies had submitted EoIs but only four finally submitted financial bids.

A source said 18 bidders – including ChrysCapital, JC Flower, Blackstone, KKR, CVC Capital Partners, and Bain Capital – have submitted EoIs for Reliance General Insurance, owned 100 per cent by RCap.

For Reliance Nippon Life Insurance, in which RCap owns 51 per cent stake, lenders have received 16 bids, including from Bain Capital, NIIF, Arpwood Partners, Dabur Investments, Bandhan Bank, and Multiples Asset Management.

A source close to the development said eight bidders have submitted EoIs for Reliance Securities, including Bain Capital, Religare Broking, Edelweiss Securities and a few ARCs.

For Reliance ARC, there are six bidders, including Bain Capital and International Asset Reconstruction Company. Eight bidders have shown interest for Reliance Health, including Blackstone, Bain Capital, Arpwood Partners, and few ARCs. There are also multiple bidders for RCap’s stake in ICEX and Paytm.

The monetisation of RCap’s assets was initiated by the Committee of Debenture Holders and the Debenture Trustee Vistra ITCL India, which represents 93 per cent of the firm’s total outstanding debt.

Advisors started the process to unlock value on October 31 and it ended on Tuesday. RCap had a consolidated debt of Rs 26,869 crore, and the standalone entity had a debt of Rs 17,446 crore as of September 2020.

RCap isn’t alone in undergoing debt resolution. In March, CARE Ratings placed Rs 11,726 crore of the firm’s subsidiary Reliance Home Finance in the default category. RHFL had said its lenders had entered into an inter-creditor agreement for arriving at the debt resolution plan. But the process was delayed because of litigation in the Delhi High Court. RHFL has cash of Rs 1,000 crore in its books, the company informed stock exchanges on November 28.

A separate debt resolution is currently underway for Reliance Commercial Finance (RCF), the NBFC arm of the company. As of March 31, RCF had assets under management (including securitised portfolio) of Rs 11,190 crore as against Rs 14,269 crore as on March 31, 2019.