The first Initial Creditors Meeting (ICM) to be recorded under Nigeria’s 2020 Companies and Allied Matters Act as well as the new Insolvency Regulations 2022 was held yesterday, Thursday, 20th October, 2022, at the Moorhouse Hotel, Ikoyi, Lagos State. The meeting, which was convened by Mr. Bidemi Daniel Olumide of Anaje Olumide Oke Akinkugbe (AO2LAW), over the affairs of The Moorhouse Company Limited (in Administration) happened further to his powers as Administrator of the Company.
You may recall that Justice D.E. Osiagor of the Federal High Court of Nigeria had earlier on Friday, July 22, 2022 gave an Interlocutory Administration Order on the Company in the Suit No. FHC/L/CS/1039/22 : Accor Afrique SA. v. The Moorhouse Company Limited.
Cross-section of attendees at the meeting
Administration, as a means for resolving insolvency situations, is one of the new and modern features of Nigeria’s new Companies and Allied Matters Act 2020. The process allows an appointed insolvency practitioner, known as the Administrator, to focus on the rescue of the insolvent business, while resolving the insolvency situation. Unlike the decisive liquidation or winding up application or process, usually employed by most unsecured creditors, Administration affords both the relevant company and its creditors, an opportunity to put in place a work program that may eventually see the company have another go at a possible positive turnaround.
Speaking after the ICM, Mr. Olumide expressed that all is certainly not lost for a company in an insolvency situation if its major stakeholders, particularly its shareholders and directors are able to formally admit their insolvency and get an Administrator to facilitate a win-win work program with creditors. A Member of the Business Recovery & Insolvency Practitioners Association of Nigeria (BRIPAN), he enthused on the new regime of possibilities that the Nigeria Corporate Affairs Commission has created for businesses in Nigeria by the release of the Insolvency Regulations 2022 and enjoins insolvent businesses to embrace it.
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