Piramal Group Company Completed DHFL’s Acquisition Process

Piramal Group company completed DHFL’s acquisition process. DHFL’s acquisition process completed, Piramal Group company paid Rs 34,250 crore to DHFL’s lenders.

Piramal Enterprises Limited has completed the acquisition process of Dewan Housing Finance Limited (DHFL).

The company said in a statement that its subsidiary Piramal Capital and Housing Finance Limited (PCHFL) has made a payment of Rs 34,250 crore to the lenders of the NBFC DHFL.

This amount has been paid in cash and through non-convertible debentures (NCDs).

The lenders will also get Rs 3,800 crore from the cash available with DHFL. Along with this, the return of the number of thousands of investors who have invested in DHFL has also been ensured.

DHFL’s lenders and fixed deposit (FD) holders will get a total of Rs 38,060 crore in this process, completed under the Insolvency and Bankruptcy Code (IBC).

This acquisition process is one of the largest cases to reach a resolution under the IBC and the largest resolution of any NBFC.

Ajay Piramal, chairman of Piramal Group, said that the process of merger of PCHFL and DHFL will be completed within the next two weeks.

Post-merger, the new company will be known as PCHFL and will be a wholly-owned arm of PEL.

Piramal Group had sent a proposal to buy debt-ridden DHFL in January 2021 itself. It has also subsequently been approved by the Reserve Bank and the National Company Law Tribunal (NCLT).

Piramal says that about 46 percent of the dues of all those who already had the liability on DHFL will be paid.

Piramal said his company would focus on strengthening its position in the housing finance sector by aligning the structure of DHFL.

Due to the acquisition, the loan book size of Piramal Group will increase by five times. Piramal will now have the business of DHFL’s 10 lakh customers along with 301 branches in 24 states of the country.

In such a situation, the company will now emphasize providing affordable housing.

Estimating the rapid growth in the demand for housing in non-metropolitan cities and semi-urban areas of India, he said that the company will open its branch in one thousand small and big cities.

He also expressed the possibility of giving one thousand new employment opportunities immediately.

DHFL was included in the country’s largest NBFC till three years ago. But in the year 2019, it got into trouble one after the other.

The company had total liabilities of Rs 91,000 crore. Kapil Wadhawan, the former promoter of the company, is facing several cases of financial misconduct.