Defaulting promoters, who are barred from a resolution plan under section 29A of the Insolvency and Bankruptcy Code (IBC), cannot use the scheme of arrangement and compromise to gain control of a company while it’s in liquidation, the Supreme Court said on Monday.
As such, the scheme of arrangement under Section 230 of the Companies Act does not stop anybody from proposing a plan. However, if this provision is used to revive a company which is facing liquidation under IBC, the rules of 29A will apply in keeping with the intent of the law, the top court clarified.
Specifically in this case, the SC order barred promoters of Gujarat NRE Coke, a defaulting company, from proposing a revival plan in the event of liquidation under IBC.
Ares SSG funds complete acquisition of Altico Capital
March 11, 2021
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Debt ridden Altico had been facing a liquidity crisis since late 2019. It had defaulted on about ₹20 crore to Mashreq Bank in September 2019
Ares SSG on Thursday announced that some of its funds have completed the acquisition of all underlying assets of Altico Capital India Limited.
“The acquisition marks the first resolution of a defaulting NBFC outside India’s Insolvency and Bankruptcy Code and represents Ares SSG’s single largest investment in India to date,” said the Asia Pacific alternative asset manager.
Funds managed by Ares SSG along with Assets Care and Reconstruction Enterprise have acquired all outstanding loans and investments from Altico for about ₹2,800 crore, which is in line with its original resolution plan submitted in February 2020.
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How bad bank model of ARC, AMC would work to manage NPAs
The proposed two-tier ARC, AMC framework, ostensibly created with public structure and private sector in mind for the respective entities, may create more problems than they serve
Hari Hara Mishra | March 8, 2021 | Updated 19:10 IST
Just making a mega NPA corporation procure NPAs from banks at a price remunerative to them can only be a pain killer, not the cure
Four years back, the Economic Survey mentioned the need for creation of the Public Sector Asset Rehabilitation Agency (PARA) to solve the twin balance sheet problems of overleveraged companies and bad-loan-encumbered banks.