The takeover of an NBFC is a strategic business move that requires considerable money and adherence to myriad compliances. Ever-tightening RBI norms have made life difficult for most NBFCs, often leading to temporary or permanent halts of business activities. When underperforming NBFCs decide to wrap up their business journey, they have only one option to sell their stakes and assets, resulting in a complete transfer of ownership to another firm.
While this is a tough decision for a struggling company, it presents an unprecedented growth opportunity for another firm. This is where the concept of an NBFC takeover comes into play. It refers to a strategic business move where an operational NBFC formally shares its intention with the acquiring firm regarding the takeover. An NBFC takeover can take weeks or even months to come into effect.
While striving for the takeover of an NBFC, the applicant firm encounters various legal implications, including MoU signing, securing creditor NOC, drafting share transfer agreements, performing fund transfers, etc. As it appears, an NBFC takeover is a compliance-intensive process and hence requires a professional approach. Companies can’t afford to make a single error as it could lead to application cancellation. To avoid such a mishap, follow the above guide or connect with a professional firm like Adviso, a one-stop avenue for your regulations and licensing woes.