This client briefing provides a general overview of schemes of arrangement for Guernsey companies under the Companies (Guernsey) Law, 2008 (the Companies Law).  A scheme of arrangement can involve almost any kind of corporate reorganisation, merger, acquisition or restructuring so long as the appropriate approvals and court sanction are obtained. In the context of restructurings, there is limited precedent in Guernsey, although such schemes of arrangement can be used to assist in insolvent/quasi-insolvent restructurings. 

Introduction

Alan Roberts (the Liquidator) was the liquidator of both Kingston Management (Guernsey) Limited (KMGL) and Amazing Global Technologies Limited (AGTL).  He was appointed on 27 May 2009 and 31 May 2010 respectively. 

The matter subject to this analysis is decision taken by a Bankruptcy Administration dealing with three companies of the same company group which are involved in a bankruptcy proceeding. Given the situation and in response of the confusing information of assets, the Administration under discussion decided to gather the three companies joining all their creditors in a sole debt pooling and besides, joining all the rights and assets of the three companies.  

The object of this article is to analyze a controversial issue which is considered in recent times by the Mercantile Courts as a current incident involved in the Bankruptcy Proceedings and more specifically, to analyze the Judgement issued by the Court of First Instance no. 9 and Mercantile Court of Cordoba dated April, 19th 2010, in which the aforementioned incident is involved.  

This incident is essentially based on establishing the treatment that should be granted to the additional guarantees provided by third parties in bankruptcy proceedings.