ASSET MANAGEMENT AND INVESTMENT NEXT LEGAL TRENDS

Panel 1 of Day 2 of Week 3 was titled, "Asset Management & Investment Next Legal Trends" and discussed topics such as structuring investment in distressed assets: The Post-pandemic challenge; and Pre pack amendment during the pandemic. Moderating the panel was Aashit Shah, Partner, J Sagar Associates and the panelists included: R S Sachdeva, President (Group Legal), JK Organisation; R. K. Bansal, M D and CEO Edelweiss ARC; and Veena Sivaramakrishnan, Partner, Shardul Amarchand Mangaldas. The session was very interactive and discussed issues in view of the recent decision in the case of Videocon where NCLT approved the resolution plan of Twin Star Technologies. In the NCLT order, it was observed that the Resolution Applicant was "paying almost nothing" as the amount offered was only 4.15% of the total outstanding claim with haircut for all the creditors being 95.85%. It was suggested to both the committee of creditors and the successful applicant to increase the payout. Currently, the matter is before NCLAT and the decision will set the limits and how much haircut will be allowed. The Supreme Court has clarified in the Essar case the primacy of 'the commercial wisdom of the CoC' in deciding the fate of the CD undergoing corporate insolvency resolution process (CIRP).

The Supreme Court in the CoC of Essar Steel India Vs Satish Kumar Gupta observed that the CoC has to take a business decision based on ground realities.