DHFL creditors give nod to Piramal resolution

The committee of creditors of Dewan Housing Finance Corp has approved a resolution plan submitted by Piramal Capital and Housing Finance on Friday, the lender informed the stock exchanges today.

Dewan Housing, however, did not disclose any details of the plan.

On Thursday, Cogencis had reported quoting sources that the Piramal Group is set to take over the beleaguered Dewan Housing Finance Corp Ltd after financial creditors voted in favour of its resolution plan, which entails payment of 373 bln rupees to them, leading to a recovery of 43%.

Insolvency proceedings against Dewan Housing started in December 2019 after the Reserve Bank of India superseded its board. The lender is the first financial services company that was resolved under Insolvency and Bankruptcy Code.

The housing financier owes 871 bln rupees to the financial creditors, including at least 454 bln rupees to bondholders. State Bank of India tops the chart with accepted dues of 72 bln rupees against the 100 bln rupees it claimed.

The resolution process had seen multiple revisions, and in the fifth and the final round, there were six resolution plans submitted by four bidders.

Piramal Group, US-based distressed assets fund Oaktree Capital, and Adani Group submitted bids for the company's entire loan book, which comes to about 650 bln rupees.

The fourth bidder, Hong Kong-based SC Lowy had submitted a plan only for Dewan Housing's corporate loan portfolio. At 0959 IST, shares of Dewan Housing were locked in the 5% upper circuit of Rs 27.55 on the NSE.