Scavenger Capital
Welcome to Scavenger Cap
About Us
Setting up a new venture or a startup or a company is exciting, but its closure can be complicated and difficult in India. Whereas founders can afford to walk away from dying companies,investors/shareholders are often left just trying to avoid the problems like statutory liabilities/litigations pending in the company or long road to closure of a company or booking the tax loss that can develop when they try to write off their unsuccessful investments as losses.
Scavenger is a type of organism that feed on decaying biomass or organisms. Therefore, they help in cleaning the environment and help grow new life. Hence, just like a Scavenger, we buy stocks/securities (100% or partly) of any dead or dying or defunct or disputed companies, or any other company in India which any fund, private equity firms, HNIs, Family offices and/or Corporate bodies wants to dump, either allowing them to recognize their Capital losses legally or assist closure of their limited period fund or for any other reasons.
Frequently Asked Questions
Who are we?
Scavenger Cap is run by a group of investors, backed by capital, supported by lawyers, chartered accountants and specialists from the field of finance and transaction advisory.
What does Scavenger Cap do?
Scavenger Cap will buy these stocks/securities from the owners at nominal value and in the Financial Year of their choice, to enable the owners to recognize their Capital Losses. For clarity, we are not into secondary shares.
At what value will Scavenger Cap buy?
Can founders also use Scavenger Cap to exit their ventures?
Yes, founders can sell and exit while leaving the legal closure of the Company to us
How long does this transaction take?
Depending on all the documentation and formalities, this transaction generally takes a week to a month’s time. If there are statutory litigations with no operating team, then it may take longer.
How does Scavenger Cap works?
- We receive an inquiry on the website.
- We respond to the inquiry with details required from you.
- On receipt of these details, we will arrange a call with you.
- Post this, we will send you an offer.
- Once the offer is accepted and signed, we will proceed to send you our SPA.
How many transactions have you done?
We did our first transaction in 2004 (of a tech company which had disputes between the founders and legal cases filed against each other) and our last one in 2023 (an incubator which invested a number of startups, some exited and some failed). We have no targets and no desperation to do deals unless it’s makes commercial sense for us to do it.
What will you do with these shares?
Scavenger Cap has different strategies depending on the type of stocks/securities bought. Usually, we hold the Securities in long term and sometimes enable liquidation.
How legal is this transaction?
This is a proper purchase and sale of securities. We have been buying securities since 2004, we know how to handle these transactions so that there are no complications.
Why should we sell the securities to Scavenger Cap?
What will the Scavenger Cap buy?
Any Indian company stock, note, warrant, SAFE or any other securities. We havent tried in case of an overseas investment, but we can start.
Is Scavenger Cap a regulated entity?
No, it is not regulated by any regulatory body. The securities will be bought in the name of an Individual or Corporate Entity depending on the structure. Scavenger Cap is just a brand name of this activity we do.
Will Scavenger Cap buy 100% of any Company?
Yes. In this case, we will also replace the directors (with indemnities built in).
What happens if there are liabilities or litigations or regulatory issues or any disputes pending in the company?
We can take care of it till infinity (for a cost of course).
Is Scavenger Cap a good option for AIFs to get exit from portfolio companies while it’s winding up?
Yes, considering the funding winter and current illiquidity of investments in the startup space, Scavenger Cap can be a go to option for the AIFs to get exit from its portfolio companies which are leading to delay in its closure process.
Is this a any tax or legal advice?
Not at all, this is not any advice. Please refer to your tax or legal advisor for any of the issues on tax or legal matters.
Whom should I contact in case I still have questions or want to submit a proposal?
Let us know your question
Feel free to contact us we are always here to serve you!
