Plans of a joint venture (JV) between Zurich Insurance and Indian business conglomerate Piramal Group to bid for Reliance General Insurance Company (RGIC) have fallen through.

Multiple factors including valuation and shareholders agreement led to the JV’s collapse, reported news agency IANS citing sources familiar with the matter.

The two firms had placed separate bids in the initial round but later agreed on a joint bid.

Reliance Capital’s general insurance business had earlier attracted bids from US-based private equity fund Advent, in addition to Zurich and Piramal.

Advent placed the highest non-binding bid of INR70bn, while Piramal and Zurich placed separate non-binding bids of INR36bn and INR37bn.

However, Advent has quit its pursuit and according to sources, the decision might be driven by IRDAI rules that mandate a five-year lock-in period for private equity investors in the Indian insurance space.

RGIC is part of debt-laden Reliance Capital that is going through a resolution process. The deadline to conclude the process has now been extended by the National Company Law Tribunal (NCLT) to 31 January 2023.

Last year in November, the Reserve Bank of India superseded the Reliance Capital board over payment defaults and governance issues, and as a result launched insolvency proceedings.

In February 2022, the RBI-appointed administrator invited expressions of interest for Reliance Capital’s sale.

Aditya Birla Sun Life and Nippon Life of Japan had earlier started merger discussions for Reliance Nippon Life Insurance, though the talks collapsed owing to differences between the firms on various issues.