Piramal said Oaktree claiming that it has received ‘preliminary feedback from credit rating agencies’ that its non-convertible debentures (NCD) would be assigned a AAA rating was a violation of Sebi norms.
Piramal Capital and Housing Finance on Friday said its bid for DHFL offers the highest upfront cash recovery, and has the highest score according to the evaluation matrix.
In a point-by-point rebuttal to the charges levelled by competitor Oaktree Capital, Piramal said the additional amount offered by Oaktree post bid date is patently ‘illegal’. The US-based investment firm had earlier written a letter to the committee of creditors on the bidding process. Oaktree said its offer was being undervalued by Rs 2,700 crore by the lenders, giving an upper hand to Piramal. The voting on DHFL bids will conclude on January 15.
Piramal highlighted that it had formally submitted a final bid within the deadline, while Oaktree sent an additional offer after the deadline offering Rs 1,700 crore more. After opening of the bids on December 23, recognising that its bid falls severely short, Oaktree sent an email on December 24 (2 days after deadline), offering an additional Rs 1,700 crore, Piramal said. “ ‘Reserving the right’ in a bidding framework is blatantly illegal and mischievous – if this were to be allowed; everyone will bid Re 1 for all assets, ‘reserve’ the right to increase, look at other bids and increase to slightly more than the highest bid,” Piramal said in a release.
Piramal said Oaktree claiming that it has received ‘preliminary feedback from credit rating agencies’ that its non-convertible debentures (NCD) would be assigned a AAA rating was a violation of Sebi norms. Credit rating agencies are not allowed by law to provide any ‘credit opinion’ or have ‘indicative credit rating discussions’, Piramal said.
Piramal reiterated that there was no specific plan for insurance shareholding that has been proposed by Oaktree. Piramal had earlier highlighted that proposed takeover of DHFL’s insurance business by Oaktree may invite regulatory challenges as it is a foreign entity. Currently, 49% of DHFL Pramerica Life Insurance is owned as foreign investment by Prudential International Insurance Holdings.
Piramal said like Oaktree, several points in its offer were not considered by the lenders for scoring purpose.“Piramal has also ascribed Rs 1,000 crore of value to the shareholding in Pramerica, and it is also not being considered for scoring purposes,” it said.