releases Deemed release: Case study BANK 1 BANK 2 BANK 3 DEBTOR PURCHASER Debt £60m Business £50m PURCHASER • Debtor company has already been in financial difficulties ; is now owned by a consortium of Banks, none of which control it Debtor’s b siness is orth £50m Banks ha e fo nd a potential P rchaser at • Debtor’s business is worth £50m ; Banks have found a potential Purchaser at this value • Banks are owed £60m by Debtor • Option 1 - Banks waive £10m of debt. Purchaser buys Debtor for £1 and procures repayment of outstanding £50m of Bank debt. • Option 2 – Purchaser buys shares and debt owed to the Banks for £50m