Market maker firm Auros said it applied for a "light touch" Provisional Liquidation order in early November; this is a "debtor in possession" type of restructuring mechanism where the incumbent management is permitted to continue trade in the capacity of "Authorized Managers" under the supervision of an external advisory firm, whilst a restructuring plan is being formulated. Upon the successful restructuring, it is anticipated that Auros' operations would resume as normal.
Auros states that a "light touch" Provisional Liquidation is fundamentally different from a formal financial liquidation, and is commonly deployed where businesses are balance sheet solvent, but cash flow insolvent, and where this cash flow insolvency can be quickly and effectively remedied by a corporate restructure.
The application was granted by the BVI Courts on November 23, 2022, allowing the affected Auros entities to explore potential restructuring options while continuing to do business under the supervision of Joint Provisional Liquidators and in accordance with an agreed protocol.
Previously, Auros filed to begin bankruptcy proceedings in the British Virgin Islands, and approximately $20 million worth of the company's assets were held on the FTX.
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