US-based private equity firm Advent has dropped its plan to participate in the resolution process of debt-ridden Reliance Capital Ltd (RCL), sources said.
In the preliminary round, Advent had shown interest in taking over RCL subsidiary Reliance General Insurance by submitting a non-binding bid of Rs 7,000 crore. Sources said Advent did not participate in VDR (Virtual Data Room) held recently and also did not seek any clarification.
When contacted, Advent did not offered any comment in this regard.
With the exit of Advent, sources said, there will be only two players (Piramal and Zurich) left in the race, and both have been exploring the possibility of submitting a joint bid for Reliance General Insurance.
The last date for submitting binding bids for Reliance Capital Ltd (RCL) and its subsidiaries is November 28.
RCL had offered two options to all the bidders. Under the first option, companies could bid for Reliance Capital Ltd, including its eight subsidiaries or clusters. The second option gave the bidders freedom to bid for its subsidiaries individually or in a combination.
RCL has eight businesses that are on the block. These include general insurance, life insurance, health insurance, securities business and asset reconstruction, among others.
The Reserve Bank of India (RBI) had on November 29 last year superseded the board of RCL in view of payment defaults and serious governance issues. The RBI appointed Nageswara Rao Y as the administrator in relation to the Corporate Insolvency Resolution Process (CIRP) of the firm.
Reliance Capital is the third large non-banking financial company (NBFC) against which the central bank has initiated bankruptcy proceedings under the IBC (Insolvency and Bankruptcy Code).
The other two were Srei Group NBFC and Dewan Housing Finance Corporation (DHFL). The RBI subsequently filed an application for initiation of CIRP against the company at the Mumbai bench of the NCLT.
In February this year, the RBI-appointed administrator invited expressions of interest for the sale of Reliance Capital.
