InvestorQ : Is the deal between Piramal and Dewan Housing now totally done?
Arya Nanda made post

Is the deal between Piramal and Dewan Housing now totally done?

Anjana Aiyar answered.
1 year ago

You can say that it is almost done because there is still one level of approval formality that is left, but now it looks like it could be more of a formality than any serious impediment to overcome. The toughest bidding battle is done and Piramal has got the vote from the Committee of Creditors over the other bidders.

Now there is one more round of progress as central bank approval has also come in. Piramal Enterprises, whose bid for DHFL was found most lucrative by the COC, has also secured permission from the RBI to go ahead with the acquisition of stake in DHFL. Now the only major approval left is that of NCLT, but they normally go by the advice of the COC.

While lenders will still have to take a hefty haircut in the range of 50-60% of the principal value of the loan, it is surely a positive development in the sense that creditors will be able to monetize part of their funds locked in. This will help the banks to improve their cash flows and improve recoveries, even if it comes at a cost.

Dewan Housing had posted a net loss of Rs.13,095 crore for the Dec-20 quarter, the second consecutive quarter of net losses. It may be recollected that Dewan Housing had been referred to NCLT as a special case by the RBI. This was more due to its huge outstanding loans to banks and also considering its systemic importance to the financial markets.