NEW DELHI: The Companies Amendment Bill passed by Parliament has brought relief for creditors involved in insolvency proceedings allowing them to acquire shares of insolvent company at a discounted price.
The Section 53 of the amended Companies Bill states, “a company may issue shares at a discount to its creditors when its debt is converted into shares in pursuance of any statutory resolution plan or debt restructuring scheme.” Earlier provision under Section 53 of Companies Act 2013 said, “Any share issued by a company at a discounted price shall be void.”
The amendments to Section 53 are expected to bring down the turnaround time for the entire restructuring process. “The amendment would provide a flexibility to credi…
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