Skip to content

CS Professional · Corporate Restructuring, Valuation and Insolvency · Resolution Strategies

Under a resolution plan for Kaveri Engineering Ltd, the applicant proposes to merge the corporate debtor with its own group company and to demerge one loss-making unit. Which statement about the Regulation 37 position is correct?

Merger, amalgamation and demerger are expressly listed in Regulation 37 as restructuring measures a resolution plan may provide. So both the proposed merger and the demerger of the loss-making unit can form part of the plan, without any separate scheme or liquidation.

  1. ARestructuring by merger, amalgamation and demerger is expressly listed as a measure a plan may provide forCorrect
  2. BMerger is allowed but demerger is not listed as a measure
  3. COnly sale of assets is allowed; restructuring needs a separate scheme outside CIRP
  4. DMerger is allowed only after the company moves into liquidation

Explanation

Clause (ba) of Regulation 37 lists restructuring of the corporate debtor by way of merger, amalgamation and demerger. Hence both the merger and the demerger can be built into the plan. A separate scheme or liquidation is not required.

Did you get it right without looking?

One question tells you little. A timed set on Resolution Strategies shows your real accuracy, how long you take and where you lose marks.

Practise Resolution StrategiesFree diagnostic mock

More Resolution Strategies questions