Hopefully this helps with your confusion:
VIP is a wholly owned subsidiary of ECIG. This means ECIG owns 100% of the common stock in VIP. VIP is a separate company and ECIG is a shareholder.
VIP's Administration process is all about the creditor's interests (VIP creditors). Basically the common stock that ECIG owns of VIP is worthless. That is what the Administrator is saying. Once the creditors are dealt with there will be nothing for ECIG, as shareholders would be the last class of creditors to receive anything and they only receive something if all other creditors (secured, preferential, and unsecured) have been paid in full. Looking at VIP's assets and liabilities it is very easy to see that ECIG will get nothing through this process.
With regards to ECIG, Chapter 7 is the end of the business, ECIG shares are worthless (only shorts are/should buy). All of ECIG's assets are going to be liquidated and proceeds distributed among its creditors according to priority (Strong).
I honestly thought Chapter 11 would happen with Strong getting full control of ECIG, but Chapter 7 means this was a way worse situation. Chapter 7 means Strong does not come out rosy like some assume, but under both scenarios the shareholders end up with worthless paper.
AI
