Hinduja Group proposes ₹300 crore infusion in Reliance General

As part of its bid to dissolve Reliance Capital, Hinduja Group has proposed a Rs 300 crore entry into the entity’s wholly owned subsidiary Reliance General Insurance.

It also bid another Rs 50 crore for items excluded under Section 66 of the IBC, in addition to its bid of Rs 9,650 crore on an NPV (Net Present Value) basis. This brings the total value of IndusInd International Holding’s bid to Rs 10,000 crore, which will be paid up front in cash.

Reliance General on two occasions – December 2022 and February 2023 – has written a letter to the Administrator seeking an injection of Promoter Capital of Rs 600 crore to support growth on par with the private general insurance industry and maintain adequate solvency.

In the expanded challenge mechanism held on Wednesday, Hinduja Group was the only bidder as the other two potential bidders – Torrent Investments and Oaktree Capital – did not participate.

Its bid of Rs 9,650 crore is Rs 1,900 crore higher than the Rs 8,110 crore bid made by the group in the first auction, where Torrent Investments emerged as the highest bidder with an NPV of Rs 8,640 crore.

The Creditors Committee (CoC) will meet on Friday where IndusInd International Holdings will present its resolution plan. Because the Code of Conduct reserves the right to negotiate the bid further, you may choose to negotiate with the sole bidder or conduct another auction if the issues of other potential bidders can be addressed.