Piramal Group's resolution plan for DHFL approved by NCLT
Published On: Monday, June 7, 2021 | By: Team KnowMyStock
The Piramal Group’s resolution plan for Dewan Housing Finance Limited (DHFL) has been approved by the Mumbai bench of the National Company Law Tribunal (NCLT). The order is subject to the outcome of the appeal in the appellate tribunal and the Supreme Court. Piramal’s plan offers to pay Rs 37,250 crore, with upfront cash of Rs 12,700 crore; it has already been approved by the committee of creditors (CoC), the Reserve Bank of India (RBI), and the Competition Commission of India (CCI). "We are pleased with the judgment today by the Honorable NCLT for approving our resolution plan for DHFL. This follows the endorsement of 94% of lenders, and the subsequent approvals from RBI and CCI, and reiterates the strength and quality of our bid", the Piramal Group said in a statement.
"This is one of India’s largest IBC proceedings, and the very first in the financial sector. In that regard, it is an important and positive trendsetter for the future. The approval from NCLT is a significant milestone in DHFL's resolution and an affirmation of the sanctity of the IBC process in India. We are committed to collaborating with all relevant authorities, regulators, creditors, and investors involved in this resolution and look forward to a speedy culmination of the resolution process,” the statement added.
DHFL became the first financial services company to be referred to the NCLT by RBI in November 2019 after it defaulted on its payments and the lenders failed to find a resolution under the June 7 circular of the RBI.
The creditors have claimed dues of Rs 87,000 crore. The liquidity crisis after the collapse of IL&FS in 2018 led to DHFL’s downfall. Before that, it was one of the largest mortgage lenders in the country.
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