The administrator of the Anil Ambani-led company has told its lenders that the highest bid received by India’s Reliance Capital, which is undergoing insolvency proceedings, was 60% below its net liquidation value, The Economic Times reported on Friday.
The Reserve Bank of India last year superseded the board of Reliance Capital, saying it would initiate bankruptcy proceedings against the firm after auditors raised several red flags about its results, including lack of clarity in its accounting practices. Also included is the shortage.
The firm has since failed to make several loan and interest payments on debentures.
If bidders fail to raise their offers significantly, there is a risk of liquidation or piecemeal sale of assets as an ongoing concern, The Economic Times reported citing two people aware of the development. .
The newspaper reported that the lenders are expected to hold one-on-one meetings with all eight bidders to discuss details and request improvements to the offers made so far.
Reliance Capital did not immediately respond to an email from Reuters seeking comment.
Billionaire Mukesh Ambani’s younger brother Anil Ambani forced a split in the group following the death of their father Dhirubhai Ambani in 2002.
Anil had gained control of electricity, financial services and the newly created telecommunications business, but heavy debt and competition forced his companies to close, or to the brink of liquidation.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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