InvestorQ : What happens to the bids for DHFL, now that Piramal and Oaktree are willing to sweetening their bids?
Lavanya Subramanian made post

What happens to the bids for DHFL, now that Piramal and Oaktree are willing to sweetening their bids?

Answer
image
Anamika Sodhani answered.
5 months ago
Follow

With the revised bids for DHFL coming, the race is really hotting up. In addition, now top bidders Oaktree Capital and Piramal Group have offered to sweeten their bids. In the case of DHFL, the amount of upfront payment to lenders and the strategy for continuation of the business and sustaining working capital needs will be crucial.

Piramal Enterprises had actually bid Rs.32,250 crore for the full book of DHFL but it has now agreed to sweeten the deal by committing to invest an additional Rs.5,000 crore in DHFL if it won the bid. This would address the all important issue of working capital sustenance. The COC had asked for firm commitments on upfront payment and time lines.

Oaktree has bid Rs.32,700 for full book of DHFL. In addition, Oaktree sweetened its bid by reducing the hold amount of Rs.1500 crore for insurance contingencies out of the upfront payment. COC has asked for more specific details on conditions and also on the time-table of upfront payment to the lenders from Oaktree also.

Since Piramal plans to merge DHFL and raise fresh funds in the name of the new entity, COC has also asked how the credit rating of the merged entity can be enhanced for further fund raising. In the case of Future Generali Insurance, Oaktree cannot own more than 49% and that is already owned by Prudential. It looks like Adani in not in contention any longer.

1 Views