Dewan Housing Finance Corporation (DHFL) in talks with US-based Oaktree Capital to offload wholesale real estate loans to the tune of Rs 17,000-18,000 crore and has signed a nonbinding agreement to facilitate this sale.
The company has been battling a liquidity crunch as over Rs 8,400 crore worth of loan repayments and securitisation payouts are maturing for payments in the next eight weeks.
"DHFL has already signed a nonbinding term sheet and is expected to close the deal in the next two weeks," a source told the ET. The modalities of the agreement are being worked out currently and are anticipated to be concluded soon.
DHFL is expected to get an upfront payment of 20-25% with the settlement spread across tranches. The deal if it goes through successfully will facilitate the sale of stakes in DHFL to a strategic partner, which can be a private equity firm or a larger financial institution, sources told the news daily.
Global distressed funds including Cerberus Capital, Lone Star Funds and Piramal Group are reportedly in talks to buyout DHFL.
The housing finance company has sold retail loans worth about Rs 30,000 crore via securitisation since the NBFC liquidity crisis began in September, triggered by the Infrastructure Leasing & Financial Services (IL&FS) default.
The management of DHFL continues to put its emphasis on inducting a strategic investor and the securitisation of its nonhousing loan exposures.
DHFL recently was in news for liquidity issues and allegations of syphoning off bank loans through layers of shell companies.
In a regulatory filing, DHFL said that over the last week there has been a lot of unwarranted speculations in the market about the continuous weakening of DHFL's credit profile as a servicer.
"We would like to place on record that the slowdown in business activity in the industry has not had any adverse impact on DHFL's debt repayment ability or loan servicing and collections of the company," it said.
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