India-based tech-focused startup LegalPay announced that the company has closed an interim finance transaction with Yashomati Hospitals Private Ltd—currently insolvent.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
India-based tech-focused startup LegalPay announced that the company has closed an interim finance transaction with Yashomati Hospitals Private Ltd—currently insolvent.
Economic Times details that this type of finance is short-term lending, typically 6-12 months. The amount of financing being deployed to Yashomati Hospitals is undisclosed, but is expected to be used for operational costs, payroll, and keeping the company running until the Insolvency and Bankruptcy Code provisions kick in.
LegalPay is planning a dozen or more such interim financing agreements. Interim financing is most often used by large corporates. LegalPay focuses on mid-level companies that are undergoing insolvencies. The interim financing trend is expected to grow as an investment opportunity, largely due to the potential for high profits, and the provisions under the IBC which work to the advantage of lenders.
