Companies

DHFL: Higher offer as per bid documents, says Adani group

Our Bureau Mumbai | Updated on November 29, 2020 Published on November 29, 2020

Other applicants trying to ‘derail’ bidding process

The fight to acquire Dewan Housing and Finance Corporation Ltd (DHFL) could spiral into a legal wrangle with the Adani group insisting that it was in the right to submit a higher bid for the entire book of the debt-laden housing finance company.

In a communication to the lenders of DHFL, Adani said its bid is as per the process laid out in the bid documents and other applicants have no rights to raise any objections because the Committee of Creditors (CoC) and the Administrator are duty bound to ensure value maximisation. The Adani Group said rival bidders were using cursive means to derail the entire bidding process by threatening to pull out of the auction.

Adani Group companies — Adani Properties and Nirjara Pedestal — had earlier written to the CoC expressing intent to revise its bid in the resolution process for the housing finance company. But this offer was made after the deadline for submitting the bid was over. The basic implication of the Adani Group’s offer was that it was ready to offer more than Oaktree Capital, which was then the sole bidder for the entire company portfolio with an offer of ₹31,000 crore. Adani Group had initially bid only for the wholesale and SRA.

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Piramal Enterprises had cried foul over this surprise move and urged the CoC and Administrator to disregard Adani Properties’ new offer. Piramal Enterprises had warned that it may have to take legal redressal, including withdrawing from the current corporate insolvency process for DHFL, if Adani Group’s unsolicited offer is considered favourably by the CoC.

This puts the CoC in a quandary because if they accept Adani group’s offer then Piramal may take legal action. On the other hand, if Adani group could take legal recourse if its offer is not considered by the lenders.

The Committee of Creditors has informed all four bidders that their revised bids will be considered only in respect of the asset for which they had initially submitted the resolution plan. No bidder will be allowed to submit a revised or new bid for different group of assets owned by DHFL.

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“ The lenders are divided and will take legal advice on this issue. There are some lenders who want to maximise the value but others want clarity on the insolvency process,” said a source.

The lenders have meanwhile extended the timeline for submission of revised bids to December 10 as they look to trim their losses. Piramal Capital and Housing Finance is gearing to bid for the entire non-banking finance company. This could make it a three-way bidding war with the Adani Group and Oaktree Capital already expressing interest to acquire the whole book of debt-laden DHFL. Piramal had earlier offered to buy only the retail book of DHFL.

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Published on November 29, 2020
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