Oaktree Capital, one of the bidders for troubled mortgage firm DHFL, has alleged, that inspite of it offering maximum value to stakeholders, there is a consistent campaign to misrepresent information about its bid.
The firm shot-off a letter to Reserve Bank of India (RBI) on Sunday, ahead of voting by lenders on bids which begins this week. Oaktree and Piramal group are in close race to get control over DHFL. The Adani group is also in fray.
Oaktree said information is being presented in an incomplete and inaccurate manner to discredit its bid. The Oaktree letter confirms that it did not give its final bid on December 22 — the last date of offering final plans — and did so only after Piramal submitted its plans. “It was only after Piramal offer was made to CoC, Oaktree raised its offer by Rs 1,700 crore. But, Piramal is offering more money upfront,” said a source close to the development. Interestingly, both offers provide zero value to shareholders of DHFL.
It claimed the equity infusion by Second Highest Bidder is uncommitted. It said that the Second Highest Bidder has sounded out on making a fresh capital infusion of Rs 3,800 crore to improve operations in the first 12 months post-implementation of the resolution plan.
This is without a binding commitment or a firm commitment letter, it claimed.
Oaktree has, on the other hand, committed to providing a fresh capital infusion of Rs 1,000 crore as a cushion to DHFL lenders, by way of a firm commitment letter, it claimed.
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 RBI.
All the lenders have made substantial provisions for their exposure to DHFL. This is the first case of a finance company being taken under Insolvency and Bankruptcy Code (IBC) and the Reserve Bank of India is keen to see an effective resolution in this case.