Oaktree says persistent campaign to discredit its resolution plan for DHFL

New Delhi, Jan 7 : Oaktree has told the Committee of Creditors (CoC) of Dewan Housing Finance Ltd (DHFL) that there has been a “persistent campaign to discredit and misrepresent its resolution plan”.
In a letter to the CoC, the India Opportunities Fund, Singapore, which has put in the bid noted that this campaign is introducing bias into the decision making process.
Oaktree said the CoC is not considering Rs 2,700 crore provided under its resolution plan. It added that Oaktree is offering a much higher fair market value by more than Rs 4,503 crore compared to the second highest bidder.
Noting that its bid offered a clean structure for the shareholders without any conditions, it said that the bid by the second highest bidder is conditional. Oaktree has demanded the CoC reject the proposal by the other bidder “dressed as implementation steps”.
Oaktree has committed to infuse equity and debt and turn around the operations of DHFL entity on a standalone, going concern basis. In contrast, the other bidder seeks to merge the entity into its housing finance business. “The contagion risk of the indebtedness to the financial instruments held by the financial creditors is significant,” it said.
It said that the other bid is “a bad deal for creditors as cash flows generated by DHFL entity will be used to service external and unrelated debt of the wholesale business after the merger”.