In a move that has surprised the bidders of Reliance Capital (RCap), the Committee of Creditors (CoC) has increased the e-auction base price by nearly 25% to Rs 6,500 crore, and postponed the dates to December 22 and 23.

The earlier base price for the e-auction was Rs 5,231 crore, which was the highest bid placed by the Cosmea-Piramal consortium. The earlier decision was to commence the two-day e-auction on December 19.

The CoC decided to change the base price and the e-auction dates at its meeting held on Tuesday, sources close to the development said.

According to the new rules, the bidders will have to increase the bid value by a minimum of Rs 1,000-crore in the first and second rounds, by Rs 500 crore in the third round and by Rs 250 crore in the fourth round.

This would result in the first bid being placed at a minimum of Rs 7,500 crore, while the second one has to be placed at a minimum of Rs 8,500 crore, bidders said, adding the “steep” increase would hamper the successful completion of the insolvency process. The e-auctions would be conducted in an ascending mode, they added.

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All the changes to the auction come ahead of the January 31, 2023, deadline for completion of RCap’s bankruptcy process.

The earlier CoC meeting to finalise the e-auction mode was held on December 9, prior to which the lenders had favoured the e-auction mode to complete the insolvency process of the debt-laden firm, voting against another suggestion of a liquidation process.

The CoC had discussed two options — closed cover auction and an e-auction — but RCap’s largest lenders, the Life Insurance Corporation of India and Employees’ Provident Fund Organisation (EPFO), had voted in favour of the e-auction. LIC and EPFO, who had rejected suggestions of a liquidation, have 35% voting rights in CoC.

LIC’s debt in RCap stands at Rs 3,400 crore, while that of EPFO is at Rs 2,500 crore.

Earlier a joint venture of Cosmea-Piramal had submitted a binding bid of Rs 5,231 crore, the highest for RCap as a core investment company, followed by Hinduja Group at Rs 5,060 crore. Torrent Group followed with a Rs 4,500 crore bid, while that by Oaktree Capital was at Rs 4,200 crore.

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According to Duff & Phelps, an independent valuator of RCap have pegged the liquidation value of the firm at Rs 13,000 crore, more than double the value of the binding bids it received, while that by RBSA stood at Rs 13,200 crore.