DHFL was sent to the NCLT
in November 2019 after the company defaulted on its debt worth Rs 90,000 crore and auditors found a Rs 15,000-crore hole in its books. The promoters of the company are currently in jail and facing money-laundering charges.
The higher upfront cash tilted the scales in Piramal's favour and was scored higher by the CoC. According to Piramal’s plan, the existing shareholders of DHFL will get zero value. The fixed deposit holders have not voted for both plans.
After the RBI
clearance, the CoC will now submit the plan for approval of the NCLT.
Piramal Capital and Housing Finance’s merger with DHFL will be effective from the date the NCLT
approves the plan, thus adding 4,500 employees to the group and investing Rs 10,000 crore of Piramal Capital’s equity in the merged entity.
For Piramal, the merger with DHFL makes sense as it would give it a stable cash flow from retail customers at a time when its own corporate loan portfolio is under stress due to a slowdown in the real estate sector. For the nine months ended December 2020, Piramal’s financial services business had a total book size of Rs 46,370 crore.
DHFL shares, locked in 5 per cent upper circuit for the past few days, closed at Rs 18.05 apiece on Thursday.
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