The RBI on November 2, 2021 has released the Report of the Committee on functioning of Asset Reconstruction Companies and review of regulatory guidelines applicable to them for public comments. The report suggests that The regulations should permit a change in the SR trustee/ asset management role from one ARC to another, without necessarily extinguishing the SRs.
Any acquisition of management/ trusteeship of a financial asset by an ARC from another ARC must have the approval of a majority, by value, of the SR holders concerned or such other prescribed threshold as may be defined by the subscription agreement / trust deed.
It may be clarified that any ARC acquiring trusteeship/management from another ARC, where the SRs are not extinguished, will be required to purchase the associated SRs to the extent of the prescribed minimum threshold.
