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DHFL lenders may name SBI Cap as advisor

Lenders to the troubled Dewan Housing Finance Corporation Limited are considering appointing investment bank SBI Capital Markets as advisors. They are looking to restructure loans to bail out the company, two bankers familiar with the development told ET.

A possible debt to equity conversion and a strategic sale of assets, people familiar with the plans said. Banks are set to meet on Friday to sign an inter-creditor agreement for the account. There is a proposal to bring SBI Caps on board. As an official decision has not been made yet, the talks are veering in that direction.

Mortgage lender DHFL faced repayment pressures after a credit crisis hit the non-bank finance sector as the fallout of the Infrastructure Leasing & Financial Services crisis. As there are unforeseen operational engagements, it would announce its fourth quarter results for the fiscal year 2019 on July 13.

Lenders had agreed to sign an inter-creditor agreement (ICA) and consider a resolution plan to rescue DHFL. It has an outstanding debt of over Rs 1 lakh crore. It is mandatory to sign an ICA for implementation of any revival plan. Lenders are now considering extending tenure of the current loans and convert short-term credit to longer tenure debt.

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Oishik Das

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