Piramal-Cosmea's ₹5,231-crore bid highest for RCap, units

Piramal Enterprises and Cosmea Financial Holdings have made the highest combined offer, of ₹5,231 crore, for Anil Ambani-promoted Reliance Capital and its units, two people aware of the final bids for the insolvent financier told ET.

The Piramal-Cosmea proposal involves Piramal offering to acquire only Reliance General Insurance Co, a wholly-owned subsidiary of Reliance Capital, for ₹3,750 crore and Cosmea making a ₹1,481-crore bid for Reliance Capital and its other units, a person cited above said. Among other bidders, Hinduja Group offered ₹5,060 crore; Torrent Investments ₹4,500 crore and Oaktree Capital ₹4,200 crore, the people cited said.

Resolution Plan Break-up

Reliance Capital, undergoing corporate insolvency, did not receive any offers for its 51% in Reliance Nippon Life Insurance. Nippon Life owns the balance 49% stake.

Reliance Capital's administrator, Nageswara Rao Y, did not respond to ET's request for comments.

All bidders' resolution plans are a combination of upfront and deferred payment components. Piramal-Cosmea's plan includes ₹4,250 crore in upfront payments and ₹981 crore at the end of the second year. Piramal's liability will be limited to the general and health insurance company, said a third person aware of the development. Sam Ghosh, founder-promoter of Cosmea Financial Holdings, was heading Reliance Capital for almost nine years, until 2017.

The Hinduja Group offer includes ₹4,100 crore upfront for Reliance Capital and its units. It has proposed to pay ₹320 crore at the end of the third, fifth and seventh years each, the first person said.

Torrent Investments' bid includes ₹1,100 crore upfront and ₹3,400 crore over five years. It proposed to pay ₹680 crore at the end of each year, along with a coupon of 10%, the same person said. Oaktree Capital offered to pay ₹1,000 crore upfront and ₹3,200 crore over five years.

Some Non-bidders

UV Asset Reconstruction Company (ARC) offered to act as a collection agent, whereby it would retain as a recovery fee 5% of the amount recovered from selling assets of Reliance Capital. Aditya Birla Sun Life Insurance, Zurich Insurance and Advent International did not submit bids, the people cited above said. Aditya Birla was a late entrant, while Zurich and Advent had submitted non-binding bids in August.

Jindal Power offered ₹27 crore for Reliance Asset Reconstruction Company. Authum Investments offered ₹28 crore for the real estate and residual businesses, while Choice Equity offered ₹91 crore for Reliance Securities, the real estate and other residual businesses of Reliance Capital.

Lenders had received 14 non-binding bids by August 30. The administrator has verified claims of Rs 23,666 crore from financial creditors; Life Insurance Corporation of India has the biggest exposure, followed by Yes Bank.

The Reserve Bank of India superseded the board of Reliance Capital on November 30, last year, citing governance concerns.