As the first development financial institution, the government of India founded the Industrial Finance Corporation of India after independence in 1947 to supply medium and long-term loans to public limited companies and cooperative societies occupied in industrious tasks.
Subsequently in 1991, the New Economic Policy of the government opened the door to privatization, liberalization and globalization of the Indian market. The organization was restructured and incorporated in 1993 but was not able to diversify its business model from project financing to other financial services. By 2004, it had practically collapsed; its profitability had not become positive.
Non-performing assets had reached their summit, and also the business did not have cash to work. It began selling off and/or renting out its premises, going door to door to save its future, and employee morale hit rock bottom. The company had become workable and unsustainable. What's their best alternative: liquidation, restructuring, merger or strategic partnership?
PUBLICATION DATE: December 19, 2013 PRODUCT #: W13538-HCB-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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