A person said that ARC has offered 20-22 paise to the country’s largest life insurance company on recovery of Rs. The binding bids by ACRE are aligned with the offers that the administrator has received from bidders Reliance Anil Ambani group company Capital undergoing corporate bankruptcy.
ACRE and LIC did not respond to ET’s request for comment.
LIC’s offer is much lower than ACRE’s 27-28% recovery paid for acquisition loan of From axis Bank And HDFC Ltd. a year ago.
In the last 18 months, LIC has thrice attempted to sell Reliance Capital’s debt, but this time the deal is likely to go through as the financial institution has announced a Swiss auction. IDBI Capital Markets, the process advisor appointed by LIC to sell Reliance Capital bonds, has sought expression of interest by November 25.
LIC has been looking for a buyer for its Reliance Capital bonds since July 2021, when it clubbed this debt among 16 accounts keep on the block. However, it did not proceed loan Sales due to mismatch of offers received and expectations.
In July 2022, it again invited offers – specifically for Reliance Capital’s ₹3,400-crore bonds – from ARCs. Although it received three binding bids, it did not proceed with the sale. In August, LIC again invited offers for Reliance Capital by 5 September.
One of the lenders, Reliance Capital, said that LIC was earlier expecting 45% recovery, but now it has become more practical.
This is the second distressed loan account that is likely to be sold by LIC. In the first week of this month, LIC invited counter bids for its Rs 613 crore loan held in KSK Mahanadi Power under the Swiss Challenge auction. It has received an anchor offer of Rs 188 crore from Rare ARC, which is equivalent to a recovery of 30 paise on Re 1.
Nageswara Rao Y, the administrator of Reliance Capital, a holding company with around 20 different holdings finance The companies have invited binding bids from interested parties by November 28.
The administrator had received 14 non-binding bids, of which approximately six were subject to alternativeWhich is Reliance Capital and all its units, such as life, non-life insurance, asset reconstruction company, securities and real estate, among others.
Aditya Birla Mutual Fund did not submit a non-binding bid and was a late entrant, which showed interest in bidding for the life insurance business of- Reliance Nippon Life Insurance. Japan’s Nippon Group holds 49% stake in the life insurance business.
Hinduja Group, Oaktress Capital, Torrent Investments, Sam Ghosh-promoted Cosmia Financial Holdings and a Naveen Jindal group company had made offers for the first option. A consortium led by Advent International, Piramal and Zurich Insurance made an offer for Reliance General – which was 100% owned by Reliance Capital.