Rehabilitate financially troubled but viable companies. Avoid liquidation or winding-up of the company.
The judicial management offers corporations an opportunity to deal with their insolvency or potential insolvent situation quickly. Even though the corporation may not be able to pay its debts, the business may still be fundamentally viable and there is a reasonable probability of rehabilitating the corporation as a going concern which would provide a more advantageous realisation of the assets as compared to a winding up.
The judicial management regime provides corporations with statutory moratorium against legal suits from creditors, while the judicial manager assesses the business position and then generates a strategy on the best way forward. The judicial manager will assume the role of management and controls the day-to-day operations of business.