Torrent Investments Opposes Fresh Auction For Reliance Capital
Torrent Investments will oppose a decision by the financial creditors of Reliance Capital to restart the auction of assets.
![<div class="paragraphs"><p>500 rupees Indian bank notes arranged for photograph. (Photo: Usha Kunji/BQ Prime)</p></div>](https://media.assettype.com/bloombergquint%2F2022-06%2F9bde9420-007b-4ba1-9722-9a0b17c32775%2F500_rupees_Indian_bank_notes_arranged_for_photograph___Photo_Usha_Kuni_Source_BQ_Prime_.jpeg?rect=0%2C79%2C1600%2C900&auto=format%2Ccompress&w=200)
Torrent Investments Pvt. will be opposing a decision by the financial creditors of Reliance Capital Ltd. to restart the auction of assets under the Insolvency and Bankruptcy Code.
According to two people with direct knowledge of the matter, the investor has already filed a petition with the National Company Law Tribunal against the fresh bidding process. According to Torrent Investments, a new bid will be in violation of the process laid down by the creditors themselves. The investor has sought that the bidding process conducted in the end of December should be considered final.
Last week, Reliance Capital's creditors decided to start a fresh auction, as Hinduja Global decided to revise its offer after the last auction was concluded. While Torrent Investments had won that auction with a Rs 8,640-crore bid, the Hinduja Group later revised its offer to Rs 9,400 crore with a majority of the payment in the form of upfront cash.
The new auction will be conducted on a higher base price of Rs 8,000 crore, compared with Rs 6,000 crore earlier. Bidders will need to bid over this base price to remain in the race, the people quoted above said.
Alongside the protest, Torrent Investments also decided to offer its entire Rs 8,640 crore in the form of upfront cash, instead of a deferred payment plan. Since the bidding is being conducted on the net present value offered by bidders, Torrent is allowed to change the way in which the payments are being made without changing the value offered, the two people quoted above said.
The NCLT had previously ordered a status quo on the bids received in December, after Torrent Investments opposed Hinduja Global's revision. If the tribunal refuses to put a stay on the new auction, Torrent Investments will submit a bid in protest, the first of the two people quoted above said.
Reliance Capital was placed under insolvency proceedings in December 2021 after the Reserve Bank of India suspended the board of the company and appointed an administrator. Financial creditors have claims worth over Rs 25,000 crore.