Wadhawan now says ready to govern DHFL as per CoC’s set standards

New Delhi, Dec 21 : Reiterating his new proposal to repay 100 per cent of the principal debt to the creditors, Kapil Wadhawan, the erstwhile promoter of the Dewan Housing Finance Corporation Ltd (DHFL), has again written a letter to the administrator of the bankrupt NBFC assuring to run it following the best corporate governance standards as as decided by the lenders.

In a letter to administrator, R. Subramaniakumar, Wadhawan said the the resolution of DHFL should not be impeded and its assets should be granted immunity in accordance with the existing provisions of the IBC.

Terming the allegations of misgovernance and fraud against him as “baseless”, he reiterated his stand that current situation of DHFL has come about on account of the liquidity crisis that affected the financial market post the collapse of ILFS and not due to the actions of the promoters.

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“Nevertheless, to allay any concerns in relation to the running of the business, I am willing to accept any governance structure that will give the members of the Committee of Creditors comfort that the business will be run with the highest standards of corporate governance and the best business practices prevalent in the market,” he said.

He noted that his settlement proposal offered an upfront payment of Rs 9,000 crore, along with repayment of an additional amount of Rs 76,814 crore over a period of 7-8 years and conversion of debt to equity of Rs 4,970 crore.

“In other words, my proposal seeks to pay a total sum of Rs 91,158 crore (constituting 100 per cent of the principal that is due to the lenders) as opposed to the resolution applicants who have only offered upfront payments ranging between Rs 10,000 to Rs 12,000 crore and a deferred payment ranging between 19,000 to 21,000 crore payable over a period of 7 to 10 years,” he said.

Wadhawan said that the figures that were available to him at the time making the the proposal, were the results that had been released by the Administrator at the end of September 2020. There would have been further collections made by DHFL thereafter.

“Nevertheless, I am willing that all such amounts be added to the upfront amount that I am offering to pay the lenders. I am also willing to agree on a process for sale of DHFL Pramerica Life Insurance (‘DPLI’) and any amount received from the sale of DPLI will be utilised entirely for the purpose of the repayment of the amounts due to the lenders,” said the letter, which was also marked to the Prime Minister’s Office (PMO), RBI Governor, Ministries of Finance and Corporate Affairs and the Committee of Creditors.

Currently, DHFL is going through insolvency proceedings at the Mumbai-bench of National Company Law Tribunal (NCLT) and Piramal Enterprises and US-based Oaktree are the final bidders in the race. The CoC is yet to vote on the resolution plan before it. The matter will go to the NCLT for final approval thereafter.

Disclaimer: This story is auto-generated from IANS service.

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