The Hinduja Group, through IndusInd International Holdings, placed the highest bid of £965 million in the second round of the auction for Reliance Capital (RCap). This development will likely place the leading creditors, the Life Insurance Corporation (LIC) and the Employee Provident Fund Organisation (EPFO), in a quandary as the liquidation value is believed to be £1.25 billion.
In addition to providing non-banking financing, RCap served as the holding company for Anil Ambani's companies that provided financial services. The general insurance and life insurance companies of RCap are the group's most valuable remaining assets following the company's bankruptcy. Insurance industry sources said that while RCap’s holdings in the insurance companies were worth well over £1 billion, the complications over the bankruptcy were resulting in distress valuations.
Torrent was the highest bidder in the first round, with £864 million. The National Company Law Tribunal announced in February as a winning bidder and invalidated Hinduja's late bid. The bidders were permitted to conduct a second round of bidding by the National Company Law Appellate Tribunal (NCLAT).
In response to Torrent’s plea, the Supreme Court said it will examine the case and seek a response from IndusInd International, Vistara ITCL (which represents bondholders), Asset Care and Reconstruction Enterprise, Yes Bank and others. Sources said that it was likely that the Supreme Court would have the final say in the matter.