The administrator to Dewan Housing Finance Corporation Ltd (DHFL) will submit the final list of prospective bidders for the bankrupt finance company at a meeting of the committee of creditors on 11 March, a person aware of the development said.
SBI Capital Markets (SBI Caps) will also make a presentation on the evaluation matrix for the bidders at the meeting, the person said. Other things to be discussed are updates on DHFL’s operations and the status of its transaction audit.
A preliminary transaction audit by Grant Thornton had indicated instances of “avoidance transactions” by the company. The auditor had informed the creditors about it at the last meeting on 20 February. The Reserve Bank of India-appointed administrator, who received the Grant Thornton report on 12 February, believes certain transactions are related to Sections 43, 45, 50 and 66 of the Insolvency and Bankruptcy Code (IBC). These sections deal with preferential transactions, undervalued transactions, extortionate (on unfair terms) transactions and fraudulent trading, respectively and are collectively termed avoidance transactions.
DHFL’s assets under management (AUM) is at 1.19 trillion, of which 63,690 crore is under retail loans and the remaining in wholesale. Earlier, expressions of interest (EoIs) were sought from potential resolution applicants under three categories.
Under option 1, EoIs were sought for the entire business of DHFL as a going concern. Under option 2A were retail assets, investments, unsecured loans and fixed assets etc; under option 2B were construction finance loans, mortgage loans, corporate loans, and inter-corporate deposits, pass through certificates (PTCs) or security receipts and under option 2C were loans to projects relating to Slum Rehabilitation Authority (SRA), Mumbai.
The non-bank financier has received expressions of interest from 24 potential investors, including Deutsche Bank AG, Hero Fincorp Ltd and Piramal Enterprises Ltd.
On 20 November, the RBI had superseded DHFL’s board and later referred the mortgage lender to the National Company Law Tribunal (NCLT). The central bank’s initiative was meant to secure the interests of creditors, including fixed deposit holders of DHFL and check any system-wide shock. DHFL is the first non-bank to be referred to NCLT under new rules notified by the government on 15 November.