An auction would be a better route for insolvency resolution of a company than the present bidding process, according to S. Balasubramanian, former chairman of the Company Law Board (CLB).
Interacting with the media here on Friday, he said the auction method would fetch better realisation and avoid unnecessary controversies surrounding the bidding process that had a time-limit associated with it.
An auction could be based on a fair base price arrived at earlier. The former chief of the CLB also felt the present process was not adequate to gauge the technical competency of a bidder. And, hence, he argued for a two-stage evaluation process. He suggested that prospective suitors should be asked to submit a technical and a financial bid.
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He regretted that the process as mandated under the Insolvency and Bankruptcy Code shut out the promoters. Having built a company and acquiring domain expertise, they should at least be heard in the resolution process, he said. The conference was organised by law firm A.K. Mylsamy Associates, which unveiled a portal on IBC cases on Friday.