Mumbai: Lenders from the troubled Dewan Housing Finance Ltd (DHFL) are analyzing a payment strategy for the 55,000 FD holders as part of the resolution plan.
According to the minutes of the meeting held last week, the committee of creditors (CoC) is analyzing different scenarios to distribute the proceeds of the funds received from the new investor. This includes distribution under the cascade mechanism or under the pari passu distribution mechanism or setting aside a part of the pending claims for small investors. mint You have reviewed a copy of the minutes of the CoC meeting that took place last week.
The revised distribution mechanism and resolution plan submitted by all bidders will be put to a vote at today’s CoC meeting.
According to the minutes, most lenders favor a distribution plan in which the CoC sets aside 5% of the claim amount for small investors with an investment of up to ₹10 lakh, unsecured financial creditors and operational creditors, and the remaining amount of the resolution is distributed under the cascade mechanism.
The consensus of all CoC members is not final, as lenders remain divided on the amount to be allocated to unsecured financial creditors, which represents a small portion of the CoC’s voting share. Catalyst Trusteeship Ltd (CTL), which represents DHFL’s retail bondholders, said unsecured financial creditors are unlikely to oppose the distribution mechanism as there is an amount set aside for them.
“The legal counsel further discussed certain legal precedents regarding the distribution mechanism in other IBC cases and mentioned that Section 53 of the Code provides a basic principle for the form of distribution, but CoC in its commercial wisdom and discretion can provide different forms of distribution as long as the key legal principle of equity is not violated and the other mandatory contents of Article 30 of the Code are complied with ”, says the minutes of the meeting.
According to the minutes, the representative on behalf of the FD holders, on the other hand, requested the CoC to consider the payment of the full amount of the claim from the FD holders for socio-economic reasons or the advance payment of the reserved amount.
He also said that in case the distribution mechanism and resolution plans are put to a vote together and the resolution plan is approved by the CoC, but the distribution plan is not approved, the lenders will follow the cascading distribution mechanism. .
Last week, DHFL’s CoC had received revised offers from Adani Group, Piramal Enterprises, US-based Oaktree Capital and Hong Kong-based SC Lowy to buy a stake in the company or purchase its assets.
Oaktree Capital raised its bid for the entire portfolio to ₹31,000 crore of ₹28,000 crore earlier, while Piramal Enterprises raised its offer for the retail portfolio to ₹26,000 crore of ₹15,000 crore before. Adani has offered ₹Rs 2,700 crore for the wholesale book and SRA (comprising loans for projects being developed for the Slum Rehabilitation Authority) compared to ₹2,200 crore earlier, while SC Lowy has raised its bid for the non-SRA book to ₹2,300 crore of ₹1,500 crore earlier, people said.
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