DHFL shares will be delisted from the exchange, 10% jump in shares, know what is the reason- Dewan Housing Finance Corporation (DHFL) informed on Tuesday that the shares of the company will be delisted from the exchange. Piramal Capital and Housing Finance Company has acquired DHFL. The National Company Law Tribunal (NCLT) on Monday 7 June approved Piramal Group’s bid for bankrupt company DHFL, subject to certain conditions.
The Mumbai Bench of NCLT took this decision. The bench, headed by HP Chaturvedi and Ravikumar Duraisamy, had said that the approval would depend on the final decision of the National Company Law Appellate Tribunal (NCLAT) and the Kapil Wadhawan case pending in the Supreme Court.
There is a tremendous rise in the shares of DHFL due to the news of delisting. The company’s shares are trading at Rs 22.85 per share, up 10 per cent on BSE.
The NCLT also dismissed the plea of DHFL promoter Kapil Wadhawan seeking a copy of the resolution plan.
Last month, the Mumbai Bench of the National Company Law Appellate Tribunal (NCLAT) had directed DHFL lenders to consider the settlement offer of DHFL promoter Kapil Wadhawan.
DHFL owes Rs 5,370 crore to fixed deposit holders
According to sources, the shares of DHFL will be de-listed after its acquisition by Piramal Finance as per IBC guidelines and SEBI directions. However, a bench comprising HP Chaturvedi and Ravikumar Duraiswami has said that the final decision on the acquisition will depend on the decision of the National Company Law Appellate Tribunal (NCLAT) and the Supreme Court. The resolution plan has been approved by the RBI in February 2021, while the Competition Commission of India (CCI) approved it in April 2021. The promoters of the company had appealed to the Supreme Court with their offer. They wanted to stop this resolution process but the Supreme Court did not allow it. DHFL owes Rs 5,370 crore to fixed deposit holders. DHFL owes about Rs 91,000 crore to banks and financial institutions. After its sinking, the matter reached NCLT.
The appellate tribunal had also directed the NCLT to consider the administrator’s application on the bid submitted by Piramal Capital and Finance for DHFL.
What is Share De-listing?
De-listing of shares can be voluntary or even on failure to comply with any law. Delisting usually occurs when a company ceases its operations, merges with another company, seeks to expand or reorganize. Or it declares bankruptcy, wants to become private or fails to meet listing requirements. When the delisting is voluntary, the company pays the investors and then withdraws its stock from the exchange. If the company does not comply with the rules then the stock exchange can also force the company to be delisted.