A day after bankrupt mortgage lender Dewan Housing Finance Corp. Ltd (DHFL) received revised bids from prospective investors, its former promoter Kapil Wadhawan sought a second hearing from lenders to reconsider his resolution proposal submitted last month.
In a letter sent to DHFL administrator R. Subramaniakumar, Wadhawan requested the lenders to let him attend their next meeting via video-conference, and sought one week’s time to arrange for the facility. Kapil and his brother Dheeraj are currently in jail for their alleged involvement in the Yes Bank money laundering case. Mint has reviewed the contents of the letter.
Wadhawan said these bids were “abysmally low” and will result in loss of public money. He also repeated his request to the creditors to consider his proposal to make full repayment to all financial creditors without any haircut.
He also suggested conversion of part debt into equity by all creditors, including bond and deposit holders.
“Even today, I’m willing to stand by the principle of 100% repayment of principal amounts to all the creditors without any haircut as I do believe, from DHFL’s business, that such recovery is possible,” he said.
“As an additional incentive, I’m also willing for all the creditors, including the NCD and fixed deposit holders, to convert part of their debt into equity so as to enjoy the equity upside they will get once the company is revived and revitalized and the company commences business as normal,” said Wadhawan in the letter.
Wadhawan argued that the offer of ₹25,000 crore for the entire company is not justified as the cash on hand, investment and real estate of DHFL alone is above ₹16,000 crore, without considering its retail/wholesale portfolio. He said the value of the retail portfolio, which had stood at ₹40,000 crore as of 31 March, would now be close to ₹30,000 crore after discounting for further impairment on account of covid-19. The value of loans to projects being developed by the Slum Rehabilitation Authority (SRA) after impairment and fair value changed stand at ₹22,000 crore.
Bids of ₹15,000-20,000 crore are unjustified when DHFL has assets of more than ₹68,000 crore, he added.
On Tuesday, Mint reported that the four bidders for DHFL have submitted their revised offers to the company following lenders’ request. Oaktree Capital has revised its bid price for the entire portfolio to ₹31,000 crore from ₹28,000 crore earlier. Piramal Enterprises has revised its bid price for the retail portfolio to ₹26,000 crore from ₹15,000 crore earlier. Adani has offered ₹2,700 crore for the wholesale and SRA book compared to ₹2,200 crore earlier and SC Lowy has upped its bid for the non-SRA book to ₹2,300 crore from ₹1,500 crore earlier.
This is the second letter written by Wadhawan claiming that outside forces are looking to depress the value of the assets. He had earlier written two letters on 17 October.
