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Tag: insolvency

  • Gaming accessory maker and publisher Nacon files for insolvency

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    French AA gaming developer and accessory manufacturer Nacon has filed for insolvency after its majority shareholder Bigben failed to make a loan repayment, the company said in a press release. “To date, the company reports available assets do not allow it to meet its liabilities,” Nacon wrote. The objective with insolvency, it said, was to allow “continued operation, protect employees and maintain jobs while renegotiating with its creditors.”

    Nacon is behind the games Styx: Blades of Greed and was set to publish Terminator: Survivors before that title was delayed. It published Hell is Us last year to some praise, but Test Drive Unlimited Solar Crown was buggy on release and failed to find much of an audience. The company will stream its next Nacon Connect presentation on March 4, and will supposedly show off some new games and footage for previously revealed games like Endurance Motorsport Series and Cthulhu: The Cosmic Abyss.

    The company also makes hardware like controllers and headsets and racing sim accessories via its Revosim brand. Those products never really caught on with mainstream gamers but did have some success with the pro gaming crowd.

    With Nacon’s insolvency, the future of those games and accessories is now in question. A court will decide on the company’s insolvency request at a hearing in early March, but in the meantime, trading of its shares is suspended.

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    Steve Dent

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  • More than 400 Sacramento City Unified preschool, classified positions could be laid off

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    The Sacramento City Unified School District’s board of education approved motions involving workforce cuts that could impact 423 positions.The two resolutions impacting preschool and classified positions come as SCUSD grapples with a $113 million deficit. The school district’s financial crisis has led to expressed frustration from families and employees as talks of having the state take over the district have been ongoing. However, school district officials earlier this month seemed optimistic that SCUSD would not hit insolvency this school year.A December report originally showed SCUD’s deficit was at $51.6 million, but that number swelled to $113 million. But the school district said it found ways to save about $44 million, previously stating that the approach includes laying off 68 administrative positions, reducing non-school department budgets, freezing non-custodial supply purchases and other measures.SCUSD’s board of education met on Thursday to approve two resolutions: one to lay off classified employees and the other to lay off preschool employees. Agenda item documents list the reasons for both actions as “a lack of work and/or lack of funds.” The documents for both categories of employees state that they will receive their layoff notices, which are effective at the end of the current school year. A district spokesperson previously told KCRA 3 that a “history of poor budgeting practices” and inaccurate representations of the district’s finances are factors in why the school district is in its dire situation. | RELATED READ | Sacramento City Unified School District Superintendent Lisa Allen resigns amid financial crisisOf the 423 positions receiving a layoff warning, 121 are vacant. There are a separate 45 positions up for consideration. However, the number of positions actually laid off may differ when decisions are finalized in May.Another update on the district’s financial plan is set for Feb. 18.See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our channel

    SACRAMENTO, Calif. —

    The Sacramento City Unified School District’s board of education approved motions involving workforce cuts that could impact 423 positions.

    The two resolutions impacting preschool and classified positions come as SCUSD grapples with a $113 million deficit.

    The school district’s financial crisis has led to expressed frustration from families and employees as talks of having the state take over the district have been ongoing. However, school district officials earlier this month seemed optimistic that SCUSD would not hit insolvency this school year.

    A December report originally showed SCUD’s deficit was at $51.6 million, but that number swelled to $113 million.

    But the school district said it found ways to save about $44 million, previously stating that the approach includes laying off 68 administrative positions, reducing non-school department budgets, freezing non-custodial supply purchases and other measures.

    SCUSD’s board of education met on Thursday to approve two resolutions: one to lay off classified employees and the other to lay off preschool employees. Agenda item documents list the reasons for both actions as “a lack of work and/or lack of funds.”

    The documents for both categories of employees state that they will receive their layoff notices, which are effective at the end of the current school year.

    A district spokesperson previously told KCRA 3 that a “history of poor budgeting practices” and inaccurate representations of the district’s finances are factors in why the school district is in its dire situation.

    | RELATED READ | Sacramento City Unified School District Superintendent Lisa Allen resigns amid financial crisis

    Of the 423 positions receiving a layoff warning, 121 are vacant. There are a separate 45 positions up for consideration. However, the number of positions actually laid off may differ when decisions are finalized in May.

    Another update on the district’s financial plan is set for Feb. 18.

    See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our channel

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  • State Farm seeks steep home insurance hikes in California

    State Farm seeks steep home insurance hikes in California

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    State Farm seeks to hike California homeowners insurance by a third or more to avoid going broke.

    State Farm General, a California unit of the Illinois-based insurance giant, asked the state Department of Insurance to allow the firm to raise homeowners insurance rates by an average of 30 percent for homeowners, 36 percent for condominium owners and 52 percent for renters, the San Francisco Chronicle reported.

    If approved, the rate jump would be State Farm’s largest in seven years, according to company filings. The rates are slated to rise next year as homeowners seek to renew their policies.

    State Farm employed a rarely used “variance request” to allow the firm to boost its prices more than normally permitted “in order to protect the insurer’s solvency.”

    The company’s requests “raise serious questions about its financial condition,” state Insurance Commissioner Ricardo Lara said in a statement. “This has the potential to affect millions of California consumers and the integrity of our residential property insurance market.” 

    State Farm didn’t immediately respond to a request for comment.

    State Farm General insures approximately one in five homes in California and last raised its rates across the state an average of 20 percent in March. It also announced it wouldn’t renew 30,000 homeowner policies and 42,000 commercial landlord policies to reduce its exposure to risk. 

    For the past year, State Farm also put the brakes on new homeowner policies. The company is bleeding cash within the Golden State — paying more for claims than it’s taking in.

    Last year, State Farm had a loss ratio of 89.61 percent in California — paying $89.61 in claims for every $100 it took in in premiums. That compares with a loss ratio of 68.25 percent for the overall market in California, according to the Department of Insurance.

    It was the company’s worst year in California since 2017, when colossal wildfires ignited tens of billions of dollars worth of insurance claims for a loss ratio of 122.4 percent.

    State Farm hinted at potential insolvency in March, when its executives fired off a letter to the Department of Insurance reporting the firm’s “capital position has been severely deteriorated, and we are increasingly concerned about its financial well-being.”

    Read more

    State Farm will not renew 72K property policies in California


    From left: Dedree Hoyt and Zane Widdes of Keller Williams, Mark Cohen of Cohen Financial Group

    Agents gauge State Farm’s exit from home insurance market


    Deal Would Bring Home Insurers Back to California

    Deal with state would bring home insurers back to fire-prone California


    At the same time, AM Best, a credit-rating agency for insurance companies, marked down State Farm’s financial strength rating from excellent to fair — issuing a “negative” outlook for its long-term issuer credit rating.

    State Farm faces increased losses due to water damage and liability claims, on top of billions spent in 2017 and 2018 because of the catastrophic wildfires, it said in its letter to the state insurance department.

    State Farm and other insurance firms backed up by California Insurance Guarantee Association, which would handle claims if any of them were to become insolvent.

    — Dana Bartholomew

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    TRD Staff

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  • Lenders approve Hinduja Group’s ₹9,661-crore resolution plan for RCap

    Lenders approve Hinduja Group’s ₹9,661-crore resolution plan for RCap

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    The committee of creditors (CoC) of Reliance Capital has approved the resolution plan put forth by IndusInd International Holding, with 99 per cent lenders voting in favour of the plan, sources told businessline.

    Hinduja Group had submitted a bid of ₹9,661 crore, all of which will be paid as upfront cash to acquire Reliance Capital and its subsidiaries. This will be in addition to the cash reserve of about ₹400 crore that RCap has generated by way of loan recoveries, among other avenues, a source said.

    Accordingly, lenders of RCap will receive about ₹10,000 crore against principal outstanding dues of ₹16,000 crore, translating to a recovery of around 65 per cent. Voting on the resolution plan began on June 9 and concluded on Thursday. The plan will now be submitted for approval of the National Company Law Tribunal (NCLT) in 7-10 days, they added. The deadline to file the final resolution plan with NCLT is July 15.

    Hinduja Group via IndusInd International Holdings, was the sole bidder in the extended challenge mechanism for resolution of RCap, submitting a bid of ₹9,650 crore, which included a proposal to infuse ₹300 crore in Reliance General Insurance. The CoC had, in May, voted in favour of equal distribution of proceeds between all members, regardless of whether they are in favour of the resolution plan.

    Meanwhile, Reliance Capital has approached the Supreme Court with the details of the second auction as per the requirements of the pending litigation against Torrent Investments which had alleged preference to the Hinduja Group and had objected to holding the second round of the challenge mechanism.

    The apex court is expected to next hear the case in August; however, with the resolution plan being finalised, the CoC has approached the SC for a hearing sooner than scheduled, businessline had previously reported.

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  • Future Enterprises’ RP invites EoIs for resolution

    Future Enterprises’ RP invites EoIs for resolution

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    The resolution professional for Future Enterprises has invited expressions of interest for its resolution, the last date for such submissions being June 25.

    Future Enterprises, which was admitted for bankruptcy proceedings on February 27, has three major manufacturing plants in Bengaluru and Maharashtra. Its total assets are valued at ₹715 core, including land, buildings and vehicles. It also has leased retail infrastructure to Future Retail and Praxis Home Retail, the value of which is ₹2,737 crore, according to the EoI filing.

    The EoI document lists three categories of prospective resolution applicants and their financial eligibility criteria.

    Under Category A are non-financial institutions — corporates, partnerships, trusts, government organisations, limited liability partnerships and Individuals — who should have a minimum tangible net worth of ₹100 crore. They can also satisfy the criteria at a ‘group’ level.

    Category B PRAs are financial institutions — investment companies, asset management companies, alternative investment funds, fund houses, private equity investors, NBFCs and ARCs. In this category, the PRAs need to have minimum AUM or committed funds available for investment, deployment in Indian companies or Indian assets of least ₹200 crore and for ARCs, minimum net owned funds of ₹1,000 crore.

    The third category of applicants is those submitting EoI as a consortium. The overall consortium should have a tangible net worth of at least ₹crore or AUM of at least ₹200 crore. The consortium can comprise applicants who satisfy the eligibility criteria of categories A or B.

    Lenders have claimed dues of ₹15,820 crore from the company while other claims amount to ₹140 crore. Future Enterprises functions as a holding company of Kishore Biyani’s Future Group and has a stake in group companies such as Future Supply Chain and Future Generali. It also develops, owns and leases retail infrastructure for the group. Future Retail, Future Supply Chain and Future Lifestyle Fashions are also undergoing bankruptcy proceedings.

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  • RCap case:Torrent Invest files plea in Supreme Court against Vistra ITCL post NCLAT order

    RCap case:Torrent Invest files plea in Supreme Court against Vistra ITCL post NCLAT order

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    After the National Company Law Appellate Tribunal (NCLAT) allowed lenders of Reliance Capital to conduct the extended Challenge Mechanism, Torrent Investments has filed a plea in the Supreme Court challenging the order.

    The plea was filed on Tuesday against Vistra ITCL, the debenture trustee acting on behalf of the 90 per cent of the committee of creditors (CoC). Vistra had dragged Torrent Invest to NCLAT after the NCLT on February 2 had ruled in favour of Torrent.

    The plea is likely to admitted in the coming week as the CoC has proposed holding the extended Challenge Mechanism on March 20 as per the NCLAT order which asked to CoC to conduct the second auction after a two-week period.

    Threshold bid

    The CoC has proposed setting the threshold bid amount for participating in the extended challenge mechanism at ₹9,500 crore on an NPV (net present value) basis. The threshold will increase by ₹500 crore for the second round to ₹10,000 crore and by ₹250 crore each for the third and every subsequent round.

    The minimum upfront cash component for bidding under the extended challenge mechanism and Round 1 has been set at ₹8,000 crore.

    The NCLAT had, on March 2, set aside the February 2 order of the Mumbai Bench of the NCLT, thus allowing the CoC of Reliance Capital to hold the second challenge mechanism, and to take “any steps for further negotiations with the Resolution Applicants”.

    A two-member Bench had held that the CoC “is fully empowered” to further negotiate with one or more resolution applicants, even after completion of challenge mechanism on December 21 when Torrent Investments emerged as the highest bidder with an NPV of ₹8,640 crore.

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