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Finacial Restructuring

Finacial Restructuring

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Published by: shantveerayya.math on Mar 26, 2009
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05/30/2013

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Hindalco to go for financial restructuring, EGM on April 2
Press Trust of India / Mumbai March 16, 2009, 18:59 IST
Aluminium major Hindalco is going for financial restructuring so that huge costsincurred by it on acquisitions do not impact the operating results, the companyinformed the Bombay Stock Exchange in a filing today.The company has called for an Extraordinary General Meeting on April 2 to seekshareholders' approval.The company said its growth strategy has led to incurring of various costs andthat it would continue to incur these costs in future."The present global economic scenario especially in the commodity space hadan adverse impact on its domestic and overseas operations which may result inimpairment in value of its assets\investments," the company said.It said it is going for financial restructuring so that its operating results would notbe impacted by such costs.The company is going for restructuring which may result in reduction of its capitalthrough a scheme of arrangement to be overseen by the Bombay High Court."This scheme will result in non-operational costs being charged against a reservecreated for the purpose out of the securities premium balance of the companyand which would be classified as, Business Reconstruction Reserve Account," itsaid.The company, however, has not indicated to what extent the capital would getreduced.
Business Capital Provides Solutions
Businesses grow in cycles that fluctuate with the economy, supply and demand. Whilemost companies enjoy periods of financial security and success, many more go through phases of financial strain. But you don’t have to face bankruptcy, financial ruin or lengthycourt proceedings. You have options. Business Capital can help you get back to businessin no time.
“The team at Business Capital are highly trained, professional deal makers who haveassisted us in a number of successful, out-of-court restructuring projects. BusinessCapital is remarkably efficient and effective in dealing amicably and objectively withlarge numbers of creditors. Their assistance in implementing out-of-court restructuring  plans has resulted in significant reduction in costs and delay, allowing clients that could 
 
not have afforded the administrative costs of a Chapter 11 to restructure and continue tooperate. “
- Karol Denniston, DLA Piper Co-Chair, Restructuring Practice Group & Head of West Coast Restructuring Practice
Debt Restructuring Benefits
Avoid Bankruptcy
Satisfy creditors based on what your business can afford
Reduce debt and stretch it out over time into fixed, affordable monthly payments
Spend less time dealing with creditors, collection agencies and attorneys
Spend more time creating revenue and optimizing your business
Keep your doors open and retain management control
Avoid unnecessary legal fees
Balance your budget and manage cash flow
Preserve vendor relations and keep vital supply lines open
Rebuild your credit and credibility
What is Debt Restructuring?
Debt can cause overwhelming financial difficulties and place a business in jeopardy.Business debt restructuring is a productive solution which aims to eliminate the financial problem and improve business liquidity by establishing fair and equitable debtrepayments to creditors.
Benefits of Working with Business Capital
Business Capital is afull service financial firmwith over ten years of experience workingwith undercapitalized businesses. We have provided services for hundreds of companiesand have worked with every industry sector in every part of the country. We provide thetime and attention it takes to tailor our services to your specific needs.Business Capital is an established leader as a corporatedebt restructuring firm. We offer you highly successfuldebt restructuring, negotiation and resolution services as well asaccess to needed assistance fromexperienced professionalswho understand the issuesfacing both debtors and creditors. We will negotiate on your behalf and work out payment programs that are satisfactory and realistic to both parties. Our commercial
 
debtnegotiation services are less costly, shorter in duration, as well as more amicable andeffective than traditional means of resolving monetary disputes.Our firm has a proven track record in achieving exceptional results. To learn more aboutdebt
 
restructuring, our debt negotiation services and how Business Capital can help,
.
Bankruptcy is not the only solution.
 
We view bankruptcy as a last ditch option. We pride ourselves in keeping our clientsoutside the bankruptcy court, while providing most of the relief associated with a Chapter 11 bankruptcy filing.
A bankruptcy filing is very expensive. The cost for a Chapter 11 bankruptcy at aminimum, is about $50,000 and most still wind up in Chapter 7 liquidationregardless. Furthermore, estimates show that an average of 75% of all Chapter 11 bankruptcy proceeds go to pay the attorneys, not the creditors. Once a debt movesinto the legal arena, more time and money is wasted by business peopleresponding to notices, appearing for hearings, talking with attorneys, etc.Meanwhile, your debt keeps growing. Add the attorney fees to collection costs,interest on the debt, filing fees, research costs, and labor costs. Suddenly that$50,000 debt has ballooned to $70,000, $80,000 or more. In some areas,collection agencies are allowed to increase a debt by 50% on the date it isassigned to them. They can then begin adding interest to the debt. It’s not unusualto see interest rates of 28% to 34% per year!
A bankruptcy filing also labels you with the worst possible credit rating and isvery public and rigid. The judge ultimately decides which creditors get paid, whatamounts they get paid, and the business owners and executives lose all control.Our goal is to settle debts to everyone’s satisfaction and do it without going through thelegal system.
Now you have options. You decide.
Business Capital’s restructuring solutions offer a much better option. We provide most of the relief without the drawbacks associated with a Chapter 11 filing. Business Capital hasdeveloped an effective system for the rapid resolution of all categories of corporateindebtedness. Our continued success in this traditionally challenging area has beenattributed to our open, non-adversarial approach to creditors. This enables our clients tomaintain vendor continuity and retain customers.At Business Capital we recognize that creditors represent one of the most importantrelationships for a business. These relationships are often the most fragile as well.Business Capital works carefully with each creditor to insure integrity and good will are preserved. We set the stage to allow relationships to move forward on stronger footingwith improved communication. Our intervention gives all parties an opportunity to step back and look at other options for settlement.We will develop an understanding of your company’s financial situation, and your wantsand needs. We conduct an analysis of your company and its creditors and then customizea solution specific to each creditor situation. We discuss possible settlements with our client before we approach the creditors. If you are simply looking for additional time to pay off the debt in full, we’ll explore that option as well.

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