DHFL lenders approve evaluation matrix for resolution plan consideration

February 28, 2020 12:45 AM

The applicant also needs to keep Rs 100-550 crore as EMD to bid for DHFL under various options given by the company.

Under Option I, suitors were invited to submit EoIs for the entire business of DHFL. Under Option I, suitors were invited to submit EoIs for the entire business of DHFL.

By Ankur Mishra

Lenders of beleaguered mortgage financier Dewan Housing Finance (DHFL) have approved the evaluation matrix for consideration of resolution plan, sources close to the development told FE.

“As per voting which concluded at 10 am on Thursday, the evaluation matrix, earnest money deposit (EMD) criteria as presented during the committee of creditors’ (CoC) meeting on February 20, has been approved with required majority,” a source said.

In the proposed evaluation matrix, 80-85% weightage was given to four quantitative parameters which includes upfront cash recovery, net present value (NPV), equity allotment to financial creditors and infusion of fresh capital. The applicant also needs to keep Rs 100-550 crore as EMD to bid for DHFL under various options given by the company.

FE has learned that 24 applicants had submitted expressions of interest (EoIs) to bid for DHFL. The company had given the option to bidders to bid for the whole company or in parts. Under Option I, suitors were invited to submit EoIs for the entire business of DHFL. Under Option II, prospective resolution applicants were invited to submit EOIs for one or more groups or a combination of any assets in isolation across different groups of DHFL.

Of the 24 applicants, 14 had submitted EoIs for the entire business of DHFL. KKR India Financial Services, Welspun Group, Adani Group, Oaktree Capital, ARCIL Asset Reconstruction Company and Bain Capital were among the suitors who placed EOIs under Option I to take over the entire business.

As per the proposed matrix, 85% score is to be quantitative, 15% qualitative for the applicant, if bidding for the whole company under Option I. For all other bidders, the proposed matrix for quantitative and qualitative score will be 80:20.

The qualitative parameters include track record of resolution applicant and its key management personal. Any resolution applicant will have to keep Rs 500-crore earnest money deposit to bid for the whole company. If the bid is made in combination of two or more parts, Rs 550 crore needs to be deposited. The minimum deposit is Rs 100 crore for the SRA category.

In a view to keep resolution time-bound, a 43-day timeline was also proposed by CoC between the last day of submission of resolution plan and voting by CoC members to approve the same. The last day of submitting a resolution plan is April 16, 2020.

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