Money & Banking

RBI approves Piramal resolution plan for DHFL

Mumbai | Updated on February 18, 2021 Published on February 18, 2021

The Reserve Bank of India is understood to have approved the resolution plan for Dewan Housing Finance Corporation Ltd submitted by Piramal Group.

“We understand that the RBI has approved the DHFL resolution plan from Piramal Capital and Housing Finance, submitted by the Committee of Creditors,” said Piramal Enterprises Ltd in a statement on Thursday.

The lenders are likely to take the proposal to the National Company Law Tribunal by next week for approval.

Piramal Capital and Housing Finance Ltd had emerged as the successful bidder for debt-laden DHFL in January this year after multiple rounds of bidding.

In the voting by the CoC, Piramal had garnered 94 per cent of the votes, while Oaktree Capital received 45 per cent of votes.

The troubled housing finance company was the first financial services firm to be taken to NCLT in late 2019, and its resolution has been closely watched.

The claims of lenders that have been admitted in NCLT in the case of DHFL aggregate to about ₹81,000 crore.

The total consideration for DHFL was ₹34,250 crore, which includes an upfront cash component of ₹14,700 crore and a deferred component of ₹19,550 crore, PEL had said in its third quarter results, adding that the acquisition is in line with its strategy to diversify its loan book and increase granularity.

“We are changing our financial services business model from one that is wholesale-led to a well-diversified one; this also being one of the key objectives behind our bidding for DHFL,” Ajay Piramal, Chairman, PEL, had said in the third quarter results.

According to the resolution plan, Piramal will merge its existing financial services business with DHFL. The merged entity is expected to focus largely on the retail real estate and lending space.

For the quarter ended December 31, 2020, DHFL posted a consolidated net loss of ₹13,095.38 crore in the third quarter of the fiscal year against a net profit of ₹934.31 crore in the same period a year ago.

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Published on February 18, 2021
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