Reliance Capital now a three horse race as Cosmea-Piramal combine decides to drop out

A consortium of Cosmea Financial Holdings and Piramal Group dropped out of the race for Reliance Capital on December 20, reports said, a day before the assets of the firm that is undergoing insolvency proceedings start going under the hammer.

The combine, whose highest binding bid of Rs 5,330 crore lenders had earlier rejected in favour of an electronic auction for better offers, cited “unreasonable” new base price of Rs 6,500 crore as the reason for pulling out, Business Standard reported.

Cosmea-Piramal exiting the auction leaves three players in the race — Hinduja, Torrent, and Oaktree.

Reliance Capital had entered debt resolution in November last year after defaulting on payment of bank dues worth Rs 24,000 crore. And the e-auction decision was taken by the Life Insurance Corporation and the Employee Provident Fund Organisation who had voted against liquidation of the firm and control 35 per cent of the voting in the creditors committee.

Duff & Phelps and RBSA Advisors had pegged the liquidation value of Reliance Capital at Rs 12,500 crore and Rs 13,200 crore, respectively, far above the bids received.