Rather than type out my position on such matters again my posts below from another thread earlier today might be the most relevant in relation to merits of VA and possible bank sale of debt to distressed debt funds.
Grant62 made some useful contributions (in reply to my posts) as well concerning the issue of transferring files by solicitors and clients in the case of external administration as well which are relevant throughout the thread.
To my mind VA would be disastrous and only considered if SGH management was not able to curb the current level of cash burn and the banks decide they can't tip any more debt into the equation (i.e. throwing good money in after bad). If SGH management can't execute on a meaningful plan to sustainable positive earnings, free cash flow and material debt reduction then, to my mind, the banks best exit option is to sell their debt to a distressed debt fund and leave it to them to sort out (possibly through debt/equity swap of the unsustainable portion of secured debt to take management control and better manage their investment).
Hope this helps answer your question.
SGH Price at posting:
33.0¢ Sentiment: None Disclosure: Not Held
