As a part of its bid for the resolution of Reliance Capital, the Hinduja Group has proposed infusing ₹300 crore in the entity’s wholly-owned subsidiary Reliance General Insurance.
It has also offered another ₹50 crore for the items excluded under Section 66 of the IBC, in addition to its bid of ₹9,650 crore on NPV (net present value) basis. This takes the total value of IndusInd International Holding’s bid to ₹10,000 crore, all of which will be paid upfront in cash.
Reliance General had on two occasions —December 2022 and February 2023 — written to the administrator seeking a promoter capital infusion of ₹600 crore to support growth at par with the private general insurance industry and maintain sufficient solvency.
In the extended challenge mechanism conducted on Wednesday, Hinduja Group was the sole bidder as the other two prospective bidders—Torrent Investments and Oaktree Capital did not participate.
Its bid of ₹9,650 crore is ₹1,900 crore higher than the bid of ₹8,110 crore made by the Group in the first auction, where Torrent Investments had emerged as the highest bidder with an NPV bid amount of ₹8,640 crore.
The CoC (committee of creditors) will now meet on Friday where IndusInd International Holdings will present its resolution plan. As the CoC retains the right to negotiate the offer further, it might choose to negotiate with the sole bidder or conduct another auction if the issues of the other prospective bidders can be addressed.