Torrent sent a protest to the administrator Nageswara Rao YCondemned the attempt to subvert the bidding process.
“One of the Resolution Applicants, in defiance of the sanctity of the challenge process, has sought to modify the bid amount quoted by it during the challenge mechanism process, in an attempt to illegally increase its bid amount beyond the permissible time period ,” it said in a note.
Creditors meeting to be held next week
“This challenge is in clear violation of the process note,” it said.
Torrent declined to comment. Hinduja The group did not respond to ET’s queries. Hinduja Group, which submitted a bid of Rs 9,400 crore after the cutoff, said the people cited above, walked out of the bidding process after making a final offer of Rs 8,110 crore, as reported by ET on December 22. All the bidders submitted their resolution plans on Thursday, giving details of upfront and deferred payments to various creditors. The people cited above said the committee of creditors (CoC) in a meeting on Friday broached the plans.
While the lenders will have to decide whether Hinduja’s bid can be accepted as the auction officially ended on Wednesday evening, experts said the issue would likely lead to litigation. Hinduja’s offer includes an upfront payment of Rs 8,800 crore to the core investment company, which owns 20 financial services entities ranging from insurance to broking, said the two people cited above. To be sure, the offer is still below a prime threshold.
A member of the Committee of Creditors (CoC) said on condition of anonymity, “The lenders were happy with Hinduja’s better offer. But unfortunately it is less than the liquidation value of Reliance Capital of Rs 12,500-13,000 crore. The revised Hinduja offer would translate into a recovery of 37% as against 35% offered by Torrent Investments in Wednesday’s auction.
Lenders will meet next week to deliberate on the resolution strategy, given that the offers are still below the liquidation value.
In the bidding round that ended on November 28, the Hinduja Group offered Rs 5,469 crore, including an upfront payment of Rs 4,100 crore. In the same round, Torrent had offered Rs 5,520 crore, of which Rs 1,100 crore was upfront.
Oaktree Capital While out of the fray after offering Rs 6,800 crore Piramal Enterprises-Cosmia Financial Holdings Did not participate in the auction.