The Re Tea Corporation Principle and Junior Creditors' Rights to Participate in a Scheme of Arrangement: A View from Singapore
This paper examines the application of the principle derived from the 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 pr...
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| Format: | text |
| Language: | English |
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Institutional Knowledge at Singapore Management University
2011
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| Online Access: | https://ink.library.smu.edu.sg/sol_research/990 http://dx.doi.org/10.1002/iir.194 |
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| Institution: | Singapore Management University |
| Language: | English |
| Summary: | This paper examines the application of the principle derived from the 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 the Re Tea Corporation’s case which might work injustice against 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. |
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