Reliance Capital’s creditors get at least six bids for stake sale

Mumbai: Creditors to Reliance Capital (RCap) have received interest from at least six potential investors for a part or whole stakes in Anil Ambani-controlled company.On the block are majority stakes in insurance, asset reconstruction and securities brokerage firms and a part stake in a commodity exchange. The proceeds from the sale will go towards recovering dues from the cash-strapped financial conglomerate.“There has been interest. We have got six bids from strategic as well as financial investors who have expressed interest and are open to negotiating with banks,” said a person familiar with the transaction.The submission of expression of interest (EoI) concluded on Tuesday. The process had begun on October 1.There are, however, no price bids yet as investors would like to gauge the exact state of the varied businesses on offer. This could lead to the sale process dragging on for days.“RCap is the holding company. The only good assets are the two insurance companies which are doing well and in a sector that is growing. So investors will be choosy on what they pick,” said a second person aware of the portfolio on offer.The company in a notice to exchanges late last month said its total debt stood at Rs 19,805 crore as of August 2020.Around 93 per cent of the debt is through bonds issued by the company. This is the reason a committee of debenture holders under the trustee Vistra ITCL India is running the monetisation process. SBI CAPS and JM Financial have been mandated to find a buyer for the company.“This process is being run outside the bankruptcy law as the RBI did not give permission to take the company to the law tribunal. In that sense it is a creditor-led asset sale,” said the second person cited earlier.On the block is a 100 per cent stake in Reliance General Insurance, the brokerage firm Reliance Securities and the non-banking entity Reliance Financial, which is engaged in capital market-linked financing activities.Also on offer is a 51 per cent stake in Reliance Nippon Life Insurance and a 49 per cent stake in Reliance Asset Reconstruction and a 20 per cent stake in Indian Commodity Exchange.It is unclear whether bidders have bid for different companies or the entire parent RCap.Separately, lenders to other Anil Ambani companies Reliance Home Finance and Reliance Commercial Finance are running a process to sell the loan book on as is where is basis.

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