Markets

BSE, NSE to suspend trading in DHFL shares

Our Bureau Mumbai | Updated on June 12, 2021

The resolution plan, approved by NCLT in which Piramal Group emerged winner, envisaged zero value for the shares of DHFL

The cup of woes of scam-hit Dewan Housing Finance Corporation Ltd (DHFL) runneth over, with BSE and NSE notifying that DHFL equity shares will be suspended from trading with effect from June 14, 2021.

NSE, in a circular to its members, said DHFL equity shares will be suspended from trading with effect from June 14, 2021 (that is closing hours of trading on June 11, 2021). BSE, in a notice said that to avoid market complications,trading in the equity shares of DHFL will be suspended with effect from June 14, 2021.

Both the exchanges said DHFL, vide its announcement dated June 8, 2021, had informed them regarding approval of the resolution plan by the National Company Law Tribunal (NCLT), Mumbai Bench, which provides for delisting of equity shares of the company.

Further, the company, vide announcement dated June 9, 2021, stated that no value was attributable to the equity shares as per the liquidation value of the Company estimated by registered valuers appointed under the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

The exchanges said the company has also mentioned that the written order of the NCLT approving the Resolution Plan is still awaited and all disclosures made remain subject to such orders.

DHFL’s shares tanked 9.97 per cent on Friday to close at ₹16.70 apiece, against the previous close of ₹18.55. The 52-week high and low of the share was ₹43 and ₹12.01, respectively.

Resolution plans

DHFL, in its regulatory filing on Wednesday, said the NCLT (Mumbai Bench) had, on June 7, approved Piramal Capital & Housing Finance Ltd’s (PCHFL) Resolution Plan, as approved by the Committee of Creditors for the corporate insolvency resolution of DHFL under Section 31 of the Insolvency & Bankruptcy Code (IBC) 2016, with certain conditions (including such directions as may be passed by the National Company Law Appellate Tribunal).

PCHFL’s Resolution Plan for DHFL envisages extinguishing all the equity shares held by existing shareholders of DHFL without payment of any price to them. PCHFL is a wholly-owned subsidiary of Piramal Enterprises Ltd (PEL).

As per PEL’s analyst presentation, the total consideration for acquiring DHFL is ₹34,250 crore. This comprises of ₹14,700 crore upfront cash component (including cash on DHFL’s balance sheet) and ₹19,550 crore deferred component (10-year non-convertible debentures at 6.75 per cent interest).

Published on June 12, 2021

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