The Supreme Court has terminated the insolvency proceedings against Mack Soft Tech, an Indian subsidiary of Irish business group Quinn, following a settlement between the litigating parties.
Mack Soft Tech Private Ltd owns Q-City, a landmark building in the IT hub at Hitec City in Hyderabad. It houses the offices of Amazon, TCS, and InforGlobal, among others.
“We welcome the Supreme Court’s decision to take Mack Soft out of insolvency. The resolution will now help us focus more on Q-City and improve the quality of tenant experience,” said Paul McGowan, the newly appointed director of Mack Soft.
Legal issues started for Q-City in 2011 when Quinn International Property Group (Quinn IPG), which had funded the asset, came into financial trouble in Ireland where it owed money to the Irish Bank Resolution Corporation (IBRC).
The IBRC alleged that the Quinn family had tried to take the Q-City asset out of Quinn IPG, knowing that Quinn IPG would be taken over by the IBRC. Since 2011, the IBRC and the Quinn Group have attempted to take control of Mack Soft, and cases were filed in Hyderabad courts.
In a turn of events after the Insolvency and Bankruptcy Code 2016 was introduced, Quinn Logistics India, an entity indirectly managed by the IBRC, decided to place Mack Soft under insolvency. The order of insolvency was passed on August 11, 2017, by NCLT-Hyderabad. Former shareholders of Mack Soft appealed to the NCLAT and the Supreme Court against the order.
However, on March 5, 2019, a global settlement was reached in respect of the litigation pertaining to Mack Soft between the IBRC and the former shareholders, and in terms thereof, the control of Mack Soft has passed to a new board. Upon conversion of certain debentures, Mack Soft is now controlled by Quinn Finance, an Irish entity controlled by the IBRC. With the Supreme Court and the NCLT approving the global settlement, the Resolution Professional appointed for Mack Soft has been removed and a new Irish-led board has been put in place. The new management has taken charge of Q-City, looking to diversify its tenant portfolio.
Source: Business Line, March 26,2019