The deferred payments will be in the form of bonds to be issued by the winner to the banks.
The lenders are getting legal opinion on Oaktree's offer, which has several riders, including a "hold back" of Rs 1,500 crore, which will go to the banks only after the insurance venture is sold and all tax liabilties are met. Besides, the insurance joint venture (JV) of DHFL, in which a foreign entity already holds 49 per cent, is turning out to be a big legal hurdle for Oaktree as well as the lenders, as the acquisition by the US firm would breach the foreign direct investment (FDI) ceiling for the insurance sector. Before Oaktree's offer is put to vote, the administrator of DHFL has to confirm to the CoC that every resolution plan that gets submitted for voting is implementable and not in contravention of any provision of law and the Insolvency and Bankruptcy
''We are waiting for legal clarifications on this aspect," said a lender.
The third bidder, the Adani group is also in fray but its offer is far below Piramal
and Oaktree offers.
Referring to foreign stake in life Insurance venture going beyond regulatory cap of 49 per cent, Oaktree has maintained its resolution offer factors in the legal requirements and will follow norms based on precedents. The company has proposed to park the 51 per cent stake of DHFL in the insurance venture in an alternative investment fund (AIF) in the event the sale process is not concluded by the effective date. Oaktree has offered to arrange a domestic AIF to purchase the stake. It has also mentioned that no separate approval shall be sought from the insurance regulator for this transfer to the AIF, given the AIF would be acting as a temporary or a parking vehicle.
DHFL is undergoing the Corporate Insolvency Resolution Process (CIRP), and is currently being managed by an administrator who is being assisted by an advisory committee in discharging duties, both the advisor and the committee were appointed by the RBI.