Comments
The Committee of Creditors (CoC) of the beleaguered DHFL has shot down the suggestion of the advisor and legal counsel to go in for a ‘Swiss Challenge’ method to decide on the winning bidder.
This was rejected as lenders felt the introduction of ‘Swiss Challenge’ would lead to legal complications and delay the entire process, sources close to the development said. Some bankers also felt that introducing ‘Swiss Challenge’ at this stage could be considered as a change of procedure (the original RFRP document did not mention ‘Swiss Challenge’) and invite objection from the original set of bidders. It may be recalled that as many as 21 persons had initially shown interest in submitting a resolution plan and participating in the resolution process for DHFL.
Introducing a ‘Swiss Challenge’, now which would have happened on electronic platform, would have meant that all the three bidders — Oaktree, Piramal and Adani Group — would be permitted to make offers against each other, implying that anyone can emerge the No 1 (winning) bidder. “In ‘Swiss Challenge’, everybody will know what the other person has initially bid and can increase the bid just like an auction. Since it is on an electronic platform, who is increasing the offer the other person will not know,” a former chief executive of a public sector bank said.
Decks cleared for voting
With the rejection of the proposal for ‘Swiss Challenge’, decks have now been cleared for the members of the CoC to evaluate and separately put to vote all the three resolution plans submitted by Oaktree Capital, Piramal and Adani Group, respectively. About 15 days from Sunday will be available for the voting process to be completed.
Indications are that the results of the voting will be available by January 13.
Only after the outcome of the voting will the distribution plan get finalised. This is crucial for the 79,000 odd depositors who are hoping that they will get some of their monies back post the resolution process.
Depositors hold 4 per cent of voting rights, while debenture-holders have 52 per cent. After several rounds of bidding, it is now evident that the Oaktree is the frontrunner, followed by Piramal and Adani Group (going by the Net Present Value), say bankers in private.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.