Piramal Group and Zurich Insurance plan to form a joint venture for taking over Reliance General Insurance, a subsidiary of debt-ridden Reliance Capital undergoing a resolution process.

Both Piramal and Zurich, which had submitted separate non-binding bids for the general insurance business of Reliance Capital in August, may hold 50 per cent each in the proposed special purpose vehicle (SPV), sources said.

Zurich confirmed that it has made a separate offer to acquire a stake in Reliance General Insurance Company as part of the resolution process under Insolvency and Bankruptcy Code (IBC).

“The terms of any transaction are subject to negotiations and there can be no assurance that a transaction will take place,” the company said in an email reply.

However, Zurich did not indicate any possible joint venture in works with Piramal Group to acquire Reliance General Insurance.

An email sent to Piramal Enterprises on the matter did not elicit any response.

If this proposed JV succeeds in emerging as the successful resolution applicant for Reliance General Insurance, it will mark the entry of Zurich Insurance in India’s general insurance business.

Piramal had valued Reliance Capital’s general insurance business at Rs 3,600 crore, while Zurich had quoted Rs 3,700 crore for the same.

As per the actuarial valuation, sources said, Reliance General Insurance is valued at Rs 9,450 crore. Meanwhile Reliance Capital’s administrator and Committee of Creditors (CoC) have extended the last date for the submission of binding bids for the company and its multiple subsidiaries by a month to October 30.

Reliance Capital Ltd (RCL) had received 14 non-binding bids for its multiple businesses. Six companies had submitted bids for the entire company, while the rest of the bidders had submitted bids for its multiple subsidiaries.

The RBI on November 29 last year superseded the board of RCL in view of payment defaults and serious governance issues.

The RBI appointed Nageswara Rao Y. as the administrator in relation to the Corporate Insolvency Resolution Process of the company.

This is the third large non-banking financial company (NBFC) against which the central bank has initiated bankruptcy proceedings under IBC. The other two were Srei Group NBFC and Dewan Housing Finance Corporation (DHFL).