‘The Re Tea Corporation principle and junior creditors’ rights to participate in a scheme of arrangement – a view from Singapore'
✍ Scribed by Chi-Ling Seah
- Publisher
- John Wiley and Sons
- Year
- 2011
- Tongue
- English
- Weight
- 225 KB
- Volume
- 20
- Category
- Article
- ISSN
- 1180-0518
- DOI
- 10.1002/iir.194
No coin nor oath required. For personal study only.
✦ Synopsis
Abstract
This paper examines the application of the principle derived from Re Tea Corporation's case in recent schemes of arrangement to break negotiation deadlocks between senior and junior creditors of a financially distressed company. This paper argues against an overly technical application of the principle in Re Tea Corporation's case which might work injustice towards junior creditors by effectively shutting them out of a restructuring. This paper further explores how the holdout problem, which led to the formulation of the Re Tea Corporation principle in the first place, could be addressed while balancing the competing interests of junior claimants in a scheme of arrangement. Copyright © 2011 John Wiley & Sons, Ltd.