Suitors for troubled mortgage lender Dewan Housing Finance Limited (DHFL) may miss the April 16 deadline to submit binding bids for the company amid the 21-day national lockdown imposed to prevent the spread of COVID-19 outbreak, banks aware of the discussions told CNBC-TV18.

The committee of creditors, therefore, is deliberating on extending the deadline to submit bids at least by 21 days to May 7 for now, two banking executives told CNBC-TV18 and may extend it further if the lockdown related disruptions continue.

“We are looking at a 30-40 day deferral for submission of resolution plans due to the lockdown,” another person involved in the deal talks said, adding that a minimum extension of 21 days was a given at this point.

“All shortlisted suitors have been given access to the data room, but there might naturally be delays in firming documents and plans given the restrictions brought upon by the lockdown,” the person quoted above added.

The 180-day time period allowed for resolution under the Insolvency and Bankruptcy Code ends on May 31st for DHFL. The creditors committee may also seek another 90 days extension permitted under IBC for the resolution, given the delays in the process, another banker told CNBC-TV18. The insolvency professional may approach NCLT as soon a s courts open for this 90 day extension, he added.

CNBC-TV18 has reported earlier in February that 24 suitors have submitted Expressions of Interest (EOI) for DHFL under NCLT. Lenders were initially hopeful of getting bids in by April 16, which will now have to be deferred.

Bids have been invited under two options. Under Option I, suitors are invited to submit EOIs for the entire business of DHFL as a going concern.

Under Option II, prospective resolution applicants are invited to submit EOIs for one or more Groups or a combination of any assets in isolation across different Groups of DHFL. For this purpose, the Administrator and Committee of Creditors of DHFL have categorised the business of DHFL into three Groups.

Group A comprises of DHFL’s retail assets, investments, unsecured loans, fixed assets, etc, Group B comprises of construction finance loans, mortgage loans, corporate loans, and inter-corporate deposits, pass-through certificates (“PTCs”)/Security Receipts (“SRs”), and Group C comprises of loans to projects relating to Slum Rehabilitation Authority, Mumbai, Government of Maharashtra.

Financial creditors alone have made claims of over Rs 86,892 crores against the company under IBC, of which Rs 80,979 cr of claims have already been admitted.

DHFL is the first financial services company to be admitted into NCLT under the Insolvency and Bankruptcy Code for resolution under the newly introduced Section 227 of the IBC.

The board of DHFL was superseded by Reserve Bank of India earlier in November owing to governance concerns and defaults in repayments by the company and sent to the NCLT thereafter. R Subramaniakumar, the former MD & CEO of Indian Overseas Bank, has been appointed as the administrator for DHFL by RBI, and he is being advised by a 3-member panel including Rajiv Lall, non-executive chairman, IDFC First Bank, NS Kannan, managing director and CEO at ICICI Prudential Life Insurance, and NS Venkatesh, chief executive of the Association of Mutual Funds in India.

First Published:Mar 31, 2020 1:27 PM IST