Reliance Capital (RCap) would most likely be acquired by The Hinduja Group through IndusInd International Holdings after a majority of financial creditors voted in favour of it. The approximate £1 billion bid from IndusInd International Holdings has been accepted, and lenders will also receive the cash balances recorded in RCap's books. This bid is the highest from any bidder even if it is less than the projected liquidation value set by the creditors.
Reliance General Insurance and a portion of Reliance Nippon Life Insurance are two of RCap's most valuable holdings. Selling these insurance businesses separately could, however, run into legal issues. Notably, the Hinduja Group, which has promoted IndusInd Bank, does not have an insurance company within its fold.
The primary creditors of RCap include Life Insurance Corporation, Employees Provident Fund Organisation, and JC Flowers Asset Reconstruction Company, which acquired Yes Bank’s bad loans. According to RCap’s website, the total admitted claims as of June 2023 amount to £2.53 billion. However, banking sources indicate that the principal amount is only £1.6 billion, with admitted claims including interest & penalties.
The resolution plan has received support from more than 99% of the creditors. The bidder has agreed to pay all lenders in accordance with their accepted claims, based on the final "Plan Value," regardless of their consent, because the bid amount is less than the liquidation value.