Reliance Capital Lenders Finalise Resolution Plan

Lenders of Reliance Capital have finalized a resolution plan

New Delhi:

Lenders of debt-ridden Reliance Capital Ltd (RFL) have decided on the Request for Resolution Plan (RFRP) document and it will be placed before them for final approval next week.

The resolution plan document sets the guidelines for submission and evaluation of the resolution plan and is shared with all companies that have submitted Expression of Interest (EoI) for submission of financial bids.

Sources said the RFRP was approved by the Committee of Creditors (CoC) of RCL in its meeting held on Wednesday. The document will be placed before the CoC for final approval next week.

As per the RFRP, sources said, the consortium cluster bidders are required to submit bids on all cash basis, but it gives the option to the bidders at the company level to bid on either cash or deferred payment basis.

The CoC has also decided to seek an extension of 3 months to complete the Corporate Insolvency Resolution Process (CIRP), sources said, adding that voting on the proposal will take place in next week’s meeting.

After an extension of 90 days, the resolution needs to be completed by September 3.

RFRP will reduce competition as no company can bid for individual clusters like Reliance General Insurance or Reliance Life Insurance.

The major conglomerates of RCL are Reliance General Insurance, Reliance Health Insurance, Reliance Nippon Life Insurance, Reliance Asset Reconstruction and Reliance Securities.

During the meeting, according to a statement by RCL, the Administrator apprised the CoC about the status of claims, CIRP process status, RFRP documents, operations of the company, filing of extension of 90 days and the way forward. Activities prescribed under the Insolvency and Bankruptcy Code (IBC).

The Reserve Bank of India (RBI) on November 29 last year superseded the board of Reliance Capital Ltd in the wake of payment defaults and serious governance issues.

RBI has appointed Nageswara Rao Y as the Administrator in relation to the Corporate Insolvency Resolution Process.


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