Due to the Covid-19 pandemic, consolidation transactions are likely to increase in India and globally as many businesses may not have the financial wherewithal to survive the crisis and will look to sell out. At the same time, there will be buyers (“Buyer”) who may have enough cash to be deployed in taking over distressed businesses. This article discusses some of the issues which the Buyer should keep in mind while buying distressed assets.

With ever increasing numbers of corporate insolvencies, it is likely that the courts will see an increase in litigation raised by insolvency practitioners and creditors arising out of restructuring arrangements entered into by companies in an attempt to stave off insolvency.

While debt restructurings must always remain a significant part of the corporate recovery toolkit, all stakeholders must be aware of the underlying rules relating to the challengeability of transactions in the run up to insolvencies.

There are two main challengeable areas in Scots law: