CVAs are a useful tool in the restructuring tool kit, and may prove extremely helpful to retailers or hospitality companies as a means of supporting those businesses as they emerge from the pandemic. The flexibility of a CVA and the ability to shape the terms of a proposal to meet the specific needs of a business have seen an increasing number of consumer led businesses use CVAs, and they have become popular as a means to restructure businesses that have a significant lease portfolio.
Following our previous alert that considered rent reductions and modifications to lease terms post New Look and Regis, this alert considers what those CVA challenge cases tell landlords about calculating a landlord's claim for voting purposes and the disclosure requirements.
From 30 April 2021, an administrator will be unable to complete a sale of a substantial part of a company's property to a connected person within the first eight weeks of the administration without either:
- The approval of creditors
- An independent written opinion (positive or negative)
This alert considers the impact of the new regulations in practice, which apply to both pre-packs and post-packs that take place within eight weeks of an administrator's appointment.
When is an evaluator's report required?
Mr Justice Zacaroli has handed down his judgment in Carroway Guildford (Nominee A) Limited and 18 others and (1) Regis UK Limited, (2) Edward Williams (as Joint Supervisor of Regis UK Ltd) and (3) Christine Mary Laverty (as Joint Supervisor of Regis UK Ltd) [2021] EWHC 1294 (Ch) following his decision in the New Look challenge last week.
Summary
The much anticipated judgement of Mr Justice Snowden in relation to a restructuring plan proposal (the “Plans”) made by Virgin Active Holdings Limited, Virgin Active Limited and Virgin Active Health Clubs Limited (the “Plan Companies”) was handed down on 12 May 2021.
Summary
The much anticipated judgement of Mr Justice Snowden in relation to a restructuring plan proposal (the “Plans”) made by Virgin Active Holdings Limited, Virgin Active Limited and Virgin Active Health Clubs Limited (the “Plan Companies”) was handed down on 12 May 2021.
On Monday, the High Court handed down its decision in (1) Lazari Properties 2 Limited, (2) The Trafford Centre Limited, (3) LS Bracknell Limited and 10 Others and (4) Fort Kinnaird Nominee Limited and 20 Others v (1) New Look Retailers Limited, (2) Daniel Francis Butters and (3) Robert Scott Fishman [2021] EWHC 1209 (Ch) considering the various grounds of challenge raised by the applicants in relation to the New Look CVA. Mr Justice Zacaroli rejected each of the grounds of challenge leaving the New Look CVA intact.
Despite the scale of the pandemic and resulting build-up of Covid related rent arrears, currently estimated at around £4.5bn, business restructuring has been relatively muted. This is partly explained by the moratorium on forfeiture and other restrictions on landlords’ remedies, combined with unprecedented government financial support for struggling businesses.
But rent arrears cannot be pushed down the track indefinitely. As restrictions are eased and focus turns to tackling this debt, business restructuring activity will no doubt intensify.
From 30 April 2021, an administrator will be unable to complete a sale of a substantial part of a company's property to a connected person within the first eight weeks of the administration without either:
- The approval of creditors
- An independent written opinion (positive or negative)
This alert considers the impact of the new regulations in practice, which apply to both pre-packs and post-packs that take place within eight weeks of an administrator's appointment.
The Corporate Insolvency and Governance Bill (the “Bill”) was published on 20 May 2020 and introduced a new debtor-in-possession moratorium to give companies breathing space in order to try to rescue the company as a going concern. The Bill went through the House of Commons on 3 June and passed through the House of Lords on 23 June. The Bill was back before the House of Commons today and is likely to receive Royal Assent next week (at which point the Bill will become law).