Financial creditors to Dewan Housing Finance Corporation Ltd. have voted in favour of a fourth round of bidding, according to two people with direct knowledge of the development.
As per the provisions of the Insolvency and Bankruptcy Code, a proposal must be approved by 66% of creditors by value to be approved by the committee of creditors.
The proposal to initiate a new round of bids received the requisite votes, the people quoted above said. The creditors will be formally writing to the four bidders on Thursday to seek fresh bids by Dec. 14, the people said. The bidders may choose to submit a fresh bid or continue with the offers they submitted on Nov. 17.
Queries sent to the RBI appointed administrator R Subramaniakumar and State Bank of India were not immediately answered.
DHFL’s resolution process has seen controversy and conflict in the last few weeks.
The proposal for a rebid came up after one of the four bidders, the Adani Group, submitted an unsolicited and materially revised offer last month. As per the new offer, Adani Group is seeking to buy DHFL’s entire loan book, instead of just the wholesale portfolio.
The offer prompted the other three bidders, Piramal Group, Oaktree Capital Management and SC Lowy, to raise concerns. Piramal Group warned of legal proceedings against the creditors if they chose to go ahead with Adani’s new bid, BloombergQuint reported earlier.
To allow equal opportunity to all bidders to review and revise bids, creditors decided to initiate a new round.
DHFL went under insolvency in November 2019, on the orders of the Reserve Bank of India. The resolution process has already seen considerable delays owing to the Covid-19 pandemic. With a new round of bids, resolution will stretch out further.
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