DHFL resolution: Lenders back Piramal's bid

  • DHFL resolution: Lenders back Piramal's bid

DHFL resolution: Lenders back Piramal's bid

The minimum requirement for winning a bid is 66 per cent votes.

According to a regulatory filing released on Sunday, DHFL has said that the company has approved the resolution plan submitted by Piramal Capital and Housing Finance Limited (under Option I in terms of the RFRP dated September 16, 2020) by CoC by majority voting under section 30 (4) of the Insolvency and Bankruptcy Code read with Reg. 39 (3) of CIRP Regulations, as the successful resolution plan.

Three entities - Adani Group, Piramal Group and US -based asset manager Oaktree Capital Management - had been invited to bid for DHFL's entire loan book. However, out of these Rs 50,227 crore or 63 per cent of the total portfolio was reported as gross NPAs.

After Piramal revised its bid, Oaktree had increased the bid by another Rs 1,700 crore after the deadline. The Piramal's offer translates to around 43 per cent for the creditors of DHFL. The additional Rs 1,700 crore offer was challenged by rival Piramal, who claimed Oaktree made the revision on December 24, after the bid deadline had closed. It also proposed to pay Rs 21,000 crore by debentures.

Oaktree Capital had offered Rs 38,400 crore, including an upfront payment of Rs 17,100 crore and Rs 300 crore to fixed deposit holders. The entire resolution process has been mired in controversy, with unsolicited offers, bickering between suitors, conflict of interest issues with legal advisors to the firm, and the promoter facing allegations of fraud.

As of July 2019, the company owed ₹83,873 crore to banks, the National Housing Board, mutual funds and bondholders. Others are Bank of India ( ₹4,125 crore), Canara Bank ( ₹2,681 crore), NHB ( ₹2,434 crore), Union Bank ( ₹2,378 crore), Syndicate Bank ( ₹2,229 crore), Bank of Baroda ( ₹2,075 crore), Indian Bank ( ₹1,552 crore), Central Bank ( ₹1,389 crore), IDBI Bank ( ₹999 crore) and HDFC Bank ( ₹361 crore).