New Delhi, March 25 (IANS) Torrent Investments has reportedly informed lenders of Reliance Capital that it is unwilling to participate in the auction to sell the financial services company.
This is likely to hurt the process to maximise returns from the sale because only the Hinduja Group may be left in the fray.
Earlier, while opposing the extension of the auction, in a letter to RBI Deputy Governor M. Rajeshwar Rao, Torrent Investments had sought directions to Nageswara Rao Y, administrator of Reliance Capital.
The letter said that the challenge process was concluded on December 21, 2022, with the administrator’s email to Torrent Investments confirming its NPV bid amount of Rs 8,640 crore as the highest bid amount.
However, Torrent Investments was made aware that a competing resolution applicant Hinduja Group had belatedly submitted a revised financial proposal on December 22 after completion of the challenge process on December 21 and after having learnt that Torrent Investments had emerged as the highest bidder.
In repeated Supreme Court judgements, it has been held that maximisation of value is a key factor in any plan approval by CoC.
The only resolution done for a financial services company under special powers of RBI Section 227 was DHFL which was won by Piramal Group.
In that case Adani Group, which was not even a resolution applicant, was admitted by CoC as it offered highest value to the Piramal bid.