Adani Group, Piramal among 4 bidders for DHFL, lenders stare at over Rs 60,000 cr write-off

Adani Group, Piramal among 4 bidders for DHFL, lenders stare at over Rs 60,000 cr write-off

New Delhi: Adani Group and Piramal Enterprises are among the many 4 entities which have positioned bids for DHFL, the primary monetary companies participant present process insolvency course of, based on sources.

Besides, sources mentioned, the US-based Oaktree and Hong Kong-based SC Lowy submitted bids for DHFL on October 17, the final date to submit remaining bids.

In November, the Reserve Bank referred DHFL, the third largest pure-play mortgage lender, to the National Company Law Tribunal (NCLT) for insolvency proceedings.

DHFL was the primary finance firm to be referred to NCLT by the RBI utilizing particular powers below part 227.

Prior to that, the corporate’s board was outmoded and R Subramaniakumar was appointed because the administrator. He can be the decision skilled below the Insolvency and Bankruptcy Code (IBC).

According to sources, Oaktree has submitted bid for the whole firm and the bid worth is Rs 20,000 crore as in opposition to the admitted legal responsibility of Rs 95,000 crore with Rs 10,000 crore money in hand.

Therefore, sources mentioned, accepting Oaktree bid would end in a write-off of Rs 65,000 crore for the lenders led by State Bank of India (SBI).

Adani Group has bid for DHFL’s Rs 40,000-crore wholesale and Slum Rehabilitation Authority (SRA) portfolio, valuing it at Rs 3,000 crore, sources mentioned.

Piramal Enterprises has bid for DHFL’s retail portfolio. It has quoted Rs 12,000 crore for the enterprise and is asking for 18 per cent yield on this portfolio, they mentioned.

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According to bankers, the bid of SC Lowy, the fourth bidder, comes with so many situations that it’s unlikely to be thought of.

Bankers are of the opinion that decision of DHFL by way of NCLT will end in a large write-off for the lenders and they are going to be caught with over Rs 60,000 crore non-performing assest (NPAs).

DHFL didn’t reply to an e-mail in search of feedback on the matter.

With this type of heavy write-off, sources mentioned, it doesn’t appear to be a very good deal for lenders.

SBI is the lead banker with an publicity of over Rs 10,000 crore to DHFL, whereas LIC and EPFO can even should write-off practically Rs 10,000 crore.

As of July 2019, the corporate owed Rs 83,873 crore to banks, the National Housing Board, mutual funds and bondholders.

DHFL was despatched to chapter after the federal government on November 15, 2019 enabled the Reserve Bank to despatched giant monetary companies corporations, excluding banks, to NCLT for insolvency proceedings.

According to a submitting final month, fraudulent transactions value Rs 17,394 crore have been reported at DHFL throughout FY07 to FY19, as per a report of transaction auditor Grant Thornton.

Fund diversion by the promoters of DHFL resulted in lenders classifying DHFL account as “fraud”.

Another fraudulent transactions value Rs 12,705.53 crore was reported by the forensic audit, adopted by the third one earlier this month.

The third fraud value Rs 2,150.84 crore, by means of undervaluing the corporate’s insurance coverage subsidiary, was detected by Grant Thornton. 

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