Shareholders in FTSE 250 company TI Fluid Systems yesterday voted down the company’s proposal to pay a £27 million dividend. In a highly unusual move, 57 per cent of shareholders in the motor part manufacturer used their votes to block the dividend payment which had been recommended by the board just four days earlier. It followed critical media coverage of the proposal, which centred on the fact that the company was making the payment while furloughing staff and cutting workers’ pay and would have resulted in a payment of almost £15 million to US private equity firm Bain Capital.
Times are changing rapidly with the current flow of Coronavirus measures introduced to support businesses in debt and distress.
We take a look at what creditors can (and can’t) do to help better protect their position.
I’m owed money. What can I do?
Certain recent government measures may impede your ability to take recovery or enforcement action at the present time. The good news is that many avenues remain available.
You cannot (in some cases):
Over the past few weeks, the UK government, regulators and other bodies have moved to help businesses navigate the unprecedented disruption caused by the COVID-19 pandemic. We start this briefing with a round-up of key changes in the areas of company law and corporate finance regulation.
Filing accounts
What is a debt-restructuring moratorium?
Since 20 April 2020, both the judicial and debt collection pauses have ended. The legal standstill decreed by the Swiss Federal Council in accordance with Art. 62 of the Debt Enforcement and Bankruptcy Act (DEBA) has thus expired. For a business that, despite the emergency aid provided by the Swiss government and the cantons, is still unable to meet its obligations (immediately) but wishes to continue its business activities, the question arises as to how it can obtain creditor protection.
Myanmar’s legal system is governed by both old and new laws and regulations, as well as internal policies and practices of the Myanmar authorities. Many laws dating back to the colonial period and post-independence period are, with certain changes, still in force. Since its political and economic opening in 2011, Myanmar has embarked on a comprehensive reform process and is currently overhauling its legal framework. Existing laws were revised or replaced, and new laws enacted.
Considerations for Distressed Transactions
In a recent decision 9354-9186 Québec inc. v. Callidius Capital Corp, 2020 SCC 10 , the Supreme Court of Canada affirmed that:
The Singapore legal system is historically based on English law, with an ever increasing local jurisprudence. A strict application of the rule of law, up-to-date regulations and legal instruments and fast-reacting legal institutions make Singapore a popular legal hub for the region.
Considerations for Distressed Transactions
Clean Sales
If a company is already trading insolvent or is on the brink of insolvency, certain provisions may jeopardise a “clean sale”, such as:
Background: Financial Backdrop
The Stats
Die aktuelle Corona-Krise eröffnet Wettbewerbern und Investoren Opportunitäten zum Kauf von Betrieben in finanziellen Schwierigkeiten. Während Betriebe oder Betriebsteile zu einem attraktiven Preis erworben werden können, bergen solche Transaktionen jedoch im Gegenzug verschiedene rechtliche Risiken.
The legal system of the Kingdom of Thailand is based on the civil law legal system. In addition, it is strongly influenced by common law principles. Primary sources of law include the Thai constitution, which is the supreme law, legislation such as codes and acts, decrees and customary principles. Under the current legal system, judicial decisions are not binding; in practice, however, decisions of the Supreme Court are persuasive, have some precedential value and are often used as a guideline for interpretation of the law.