 "Reliance Capital")
Lenders to debt-ridden Reliance Capital Ltd on Wednesday granted the fifth extension of deadline for submission of resolution plans as bidders sought more time to complete the due diligence process, sources said.
The new deadline is August 28, while the earlier date was August 10.
Piramal and Torrent had asked for an extension till September 30, which was rejected by the Committee of Creditors (CoC), sources said, adding IndusInd Bank had sought extension till August 30.
Reliance Capital's resolution plan submission date has been extended four times in the past. The original deadline for submission was May 26.
Reliance Capital had initially received 54 Expressions of Interest (EoIs), but now only 5-6 bidders are active at the due diligence stage.
Due to poor response, the CoC has also waived off the condition of paying Rs 75 crore Earnest Money Deposit (EMD) in the first submission date.
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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 Reliance Nippon Life Insurance.
As per the regulations, Piramal, which already has 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 the Piramal Group.
According to sources, CoC and the administrator are more keen on receiving bids under Option-1, that is for Reliance Capital as a CIC (Core Investment Company).
Under Option-2, bidders can bid for 8 different businesses/clusters of Reliance Capital Ltd (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The Reserve Bank of India (RBI) had on November 29 last year superseded the board of RCL in view of payment defaults and serious governance issues.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).
The 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.
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