The Piramal Group hopes to complete its acquisition of Dewan Housing Finance Corporation Ltd. by about August, a person with direct knowledge of the matter told BloombergQuint, while acknowledging that the process could see further delay due to legal challenges.
The Mumbai bench of the National Company Law Tribunal on Monday approved a resolution plan submitted by Piramal Group, adding some conditions. Piramal Group’s resolution plan, which offered Rs 37,250 crore for DHFL, was approved by the committee of creditors in January with a majority.
The conditions in the Monday order include a decision on a settlement proposal by DHFL promoter Kapil Wadhawan, which the NCLT had ordered the committee of creditors to consider on May 19. The creditors challenged the NCLT order at the appellate tribunal, which stayed the directions. The National Company Law Appellate Tribunal is yet to pronounce an order on the treatment of the settlement proposal. Wadhawan has already filed a petition with the Supreme Court, opposing the NCLAT stay.
Pending the outcome of the legal challenges, a monitoring committee will start to lay down the road map to try and complete the acquisition within 90 days. The Piramal Group plans to merge assets of the beleaguered housing finance company with Piramal Capital & Housing Finance Ltd.
Over the next few weeks Piramal Group will formulate the process of issuing non-convertible debentures to DHFL’s creditors, as is required in the resolution plan. Lenders to Piramal Capital & Housing Finance would need to provide no-objection certificates for this process to be concluded, the person quoted above said.
According to Dinesh Kumar Khara, chairman, State Bank of India, the NCLT order is a “very positive development”.
Queries mailed to Piramal Group on Monday were not immediately responded to.