Chapter 15 Headlines
Embattled Chinese coffee chain Luckin Coffee Inc. filed for chapter 15 bankruptcy in New York, less than a year after the company said that more than a quarter’s worth of business may have been faked, Bloomberg News reported. The move will protect the company from lawsuits by U.S. creditors while it reorganizes in China, where it runs several thousand outlets. All its coffee shops will remain open for business and the chapter 15 petition will not materially impact the company’s day-to-day operations, according to a statement issued today.
American affiliates of Canadian restaurant business Yatsen Group sought Chapter 15 recognition in Delaware bankruptcy court, saying COVID-19 has ravaged its business and left its locations unable to pay rent, Law360 reported. Yatsen Group of Companies Inc., SAR Real Estate Inc. and 36 affiliates filed their petition late Monday, while a foreign, main case proceeds in Canada.
A unit of British restaurant chain PizzaExpress is seeking bankruptcy protection in the U.S. PizzaExpress Financing 2 Plc filed for Chapter 15 in the Southern District of Texas Court, according to filing, Bloomberg News reported. Chapter 15 shields foreign companies from lawsuits by U.S. creditors while they reorganize in another country. The iconic restaurant chain had been struggling even before the pandemic as changing dining trends reduced demand for its pizzas, and as Hony’s efforts to expand its business outside the U.K. stretched its balance sheet.
Dutch retailer Hema filed for Chapter 15 court protection in the U.S. in the latest step of a debt restructuring as the popular local firm prepares for its sale, Bloomberg News reported. Chapter 15 shields foreign companies from lawsuits by U.S. creditors while they reorganize in another country. The filing came late Wednesday, the same day that Hema’s restructuring plan received support from the vast majority of its senior-ranking bondholders in a U.K. court process.
Lenders to bankrupt Reliance Communications Ltd (RCom) and Reliance Telecom Ltd (RTL) have told the Supreme Court that spectrum is an essential and integral part of asset against which banks grant loans to telecom firms, Mint reported. This is contrary to the government’s stance that spectrum is national property and cannot be sold under insolvency proceedings.
Virgin Atlantic Airways Ltd is seeking protection from creditors in the United States under Chapter 15 of the U.S. Bankruptcy Code, which allows a foreign debtor to shield assets in this country, according to a court filing on Tuesday, Reuters reported. Virgin Atlantic’s filing in U.S.
U.K. discount retailer Matalan will file for Chapter 15 court protection in the U.S. on Wednesday as part of broader measures to buttress its balance sheet in the aftermath of pandemic-inflicted closures, Bloomberg News reported. The company will seek “certain interim relief” under Chapter 15 and recognition for its debt restructuring in the U.K., according to a statement Tuesday. Chapter 15 of U.S. bankruptcy law shields foreign companies from lawsuits by U.S. creditors while they reorganize in another country. The retailer used a U.K. court procedure known as a scheme of arrangement.
Cirque du Soleil and its secured creditors are close to reaching a agreement on a second stalking horse bid for the financially strapped entertainment group, after lenders opposed a deal with shareholders including TPG Capital and Fosun International, a Canadian court heard today, Reuters reported. Canada’s once high-flying Cirque has received protection from creditors as it restructures after the COVID-19 pandemic forced it to cancel shows and lay off artists. The Montreal-based entertainment company filed for bankruptcy in late June.