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DHFL news: NCLT clears Piramal bid to acquire DHFL | India Business News – Times of India




MUMBAI: The National Company Law Tribunal (NCLT) on Monday approved Piramal Group’s bid to acquire DHFL. In their order, H P Chaturvedi and Ravikumar Duraisamy of the tribunal’s Mumbai bench said that the approval was subject to the final judgment from the National Company Law Appellate Tribunal (NCLAT) and the Supreme Court’s decision.
On May 19, the NCLT had asked lenders to consider an offer made by jailed promoter Kapil Wadhawan, which lenders found ineligible to be voted on. They appealed against the order to the NCLAT, which ruled in favour of the lenders. Wadhawan has since approached the Supreme Court, which is likely to decide on Tuesday whether to admit his petition or not.
On Monday, the NCLT also asked the committee of creditors (CoC) to consider giving more money to fixed deposit holders and small investors. Responding to the order, Piramal Group said, “We are pleased with the judgment today approving our resolution plan for DHFL. This follows the endorsement of 94% of lenders, and the subsequent approvals from the RBI and CCI, and reiterates the strength and quality of our bid.”
DHFL is among the largest Insolvency & Bankruptcy Code (IBC) proceedings with over Rs 90,000 crore of debt, and the very first in the financial sector. The RBI initiated bankruptcy proceedings against the company after it failed to meet its liabilities and promoters came under investigation for fraud. Bankers were hopeful of the resolution being completed in the first quarter, but now they expect the process to be completed only after July.
“This decision paves the way for a quick resolution. Yes, there are legal challenges, and we need to wait for those decisions, but we are confident that this will happen quickly,” said Rajkiran Rai, MD & CEO of Union Bank of India, which one of the large lenders to the group. He added that the CoC will look at the court’s directions to consider giving more to fixed deposit holders. “This group of creditors has voted against the resolution and, according to NCLT mechanism, they are eligible for liquidation value. But that is a decision which the CoC needs to take, and I do not want to pre-empt the CoC,” said Rai.
According to banking industry sources, the fixed deposit holders will not be stakeholders in the company after the acquisition as Piramal will be operating the company as a non-deposit taking NBFC.