The Insolvency and Bankruptcy Board of India (IBBI) has proposed a two-part resolution plan structure to ensure the swift takeover of stressed firms without delay. The plan aims to prevent asset value erosion and streamline the resolution process. It also addresses the issue of distribution of resolution proceeds among stakeholders. The regulator has sought public comments on the proposed changes to regulations, including providing clarity on the entitlement of dissenting financial creditors and making the fair value of a stressed firm part of the information memorandum for potential suitors.
State Bank of India (SBI) and IL&FS have different views on debt restructuring at ITPCL, the bankrupt financier’s power joint venture entity. SBI wants an assessment of the liquidation value before signing on the proposal, while IL&FS, as part of its resolution framework, is not obligated to undertake a liquidation assessment for this asset. Last month, lenders approved a restructuring plan for ITPCL, with 59% of its debt classified as sustainable and the remaining 41% converted into non-convertible debentures. ITPCL operates a 1,200-MW power plant in Tamil Nadu.
The liquidation value of Uniply has been put at ₹38.03 crore. West Coast Paper is set to acquire Uniply Decor for an amount lower than its liquidation value. This article provides more information on the acquisition.
