Carlyle Capital Corporation Limited announced at the weekend that class A shareholders had voted in favour of a compulsory winding up proceeding, under the companies law in Guernsey, in line with a recommendation by the board of directors.
The shareholder approval process was completed on March 16th, 2008, with class A shareholders voting unanimously in favour of the move.
The company will now move forward with the winding up and liquidation application. During a compulsory winding up, all remaining CCC assets will be liquidated by a court appointed liquidator in a timely and orderly manner.
As expected, the company received default notices from its remaining two lenders, and it believes that its lenders have now taken possession of substantially all of its US government agency AAA-rated residential mortgage-backed securities (RMBS). As a result, the company believes that its liabilities exceed its assets.
The recommendation was made by the board following extensive analysis of the company’s prospects and careful consideration of other options for continuing the business.
The company will work with the court-appointed liquidator to ensure an orderly realization of assets and their subsequent distribution.
CCC, a publicly-listed company on Euronext Amsterdam, was set up by private equity giant Carlyle Group in 2006 to invest in fixed income assets, consisting of US government agency AAA-rated RMBS securities and leveraged finance assets.
However, it ran into almost immediate difficulties after listing in July 2007 when the credit markets began to seize up.
Negotiations with lenders to refinance CCC's portfolio of US mortgage-backed securities were terminated last week with the company unable to reach a deal.
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