large scale image
LCP Image

Back to TSCFM News

RCap lenders to run another round of e-auction

January 09, 2023

RCap lenders to run another round of e-auction
The committee of creditors (CoC) has decided to conduct another round of challenge mechanism, targeting more than ₹10,000 crore of proceeds through the insolvency process. A number of bidders, including Cosmea Financial, Piramal Group and Oaktree Capital, will be eligible to take part in the second round of e-auctions, apart from the existing bidders.

The second challenge mechanism would be conducted with a reserve price of ₹9,500 crore, compared with the minimum threshold value of ₹6,500 crore in the first round. This round would also mandate that bidders pay a minimum upfront cash payment of about ₹8,000 crore, sources close to the development said.

Under the new mechanism, participants will have an option to up the bid amount by a minimum ₹500 crore in the first round. This will increase the minimum bid amount to ₹10,000 crore.

RCap’s lenders will meet on Monday (January 9) to vote on the proposal to conduct the second round, which is likely to be held by January 20.

“The next round of e-auctions is being mulled as lenders are not satisfied with the commercial viability of the existing bids it received from Torrent Group and Hinduja Group through the first round of the challenge mechanism. Further, the second attempt is also to maximise the value of the stressed assets and reduce the haircut the lenders would have to take,” one of the sources said.

According to the CoC, RCap’s liquidation value was pegged at about ₹13,000 crore and fair value was at ₹17,000 crore.

Important Links:

Recommended for you ...

Modi, Mauritius, and Sri Lanka Leaders Unveil Digital Payment Services
Modi, Mauritius, and Sri Lanka Leaders Unveil Digital Payment Services

February 12, 2024

Public Sector Banks Surpassing Private Peers, Investors Reconsidering Choices
Public Sector Banks Surpassing Private Peers, Investors Reconsidering Choices

February 12, 2024

Indian Banks Seek RBI Permission for Global Bond Trading Ahead of Inclusion in Indices
Indian Banks Seek RBI Permission for Global Bond Trading Ahead of Inclusion in Indices

February 12, 2024

Enquire Now
REQUEST A CALLBACK
Chat on WhatsApp