NEW DELHI: The e-auction for acquiring Reliance Capital will be a three horse race, as the fourth contender Oaktree is likely to exit from the race.
Oaktree, which has submitted a resolution plan of Rs 4,200 crore for acquiring the erstwhile Anil Ambani group company, could withdraw from the auction as two of its demands are unlikely to be fulfilled by the lenders, sources in the know of development told this newspaper.
Oaktree has asked for Reliance Capital’s financial results till 31st December 2022 and a four week extension for conducting the auction process. Both the demands have been termed as ‘impractical’ by the lenders of Reliance Capital. The lenders in a meeting held on Tuesday rejected these demands of Oaktree. They now feel that Oaktree will not participate in the auction process to be held in the week starting 19 December.
The lenders argued that with the National Company Law Tribunal (NCLT) directing the committee of Creditors (CoC) to complete the resolution process of Reliance Capital by 31 January, there is no scope of an extension of the auction by a month. With Oaktree out of the race, Cosmea-Piramal consortium, Hinduja, and Torrent Group will participate in the e-auction.
Reliance Capital had received four binding bids on November 28, which was the last date for submitting the bids. The highest bid of Rs 5,231 crore has been submitted by a consortium of Cosmea Financial and Piramal. Hindujas with Rs 5,060 crore has emerged as the second highest bidder, followed by Torrent Investment (Rs 4,500 crore) and Oaktree (Rs 4,200 crore).
Within e-auction, lenders have two options, either to go for an ascending or descending auction. Sources told TNIE that foreign banks are pushing for the descending auction wherein the base price will be `17,000 crores. In case of the ascending auction process, the base price will be Rs 5300 crore - the highest bid value quoted by Cosmea and Piramal consortium.