On 27 February 2024, the High Court sanctioned a restructuring plan (the Plan) proposed by CB&I UK Limited (CB&I), part of the global McDermott construction and engineering group (the Group). This is the first English restructuring plan to be approved after the Court of Appeal judgment in Adler (see our Alert) and follows the guidance in that case.
Background
On 23 January 2024, the Court of Appeal overturned the High Court's sanction of Adler Group's (Adler) restructuring plan (the Plan) (see our alert). This much anticipated judgment provides clarity on the court's discretion to sanction a plan where there are dissenting classes of creditors.
Background
The Plan envisaged:
The Court of Cassation has considered whether company insolvency proceedings may be extended to a managing director and shareholder who has made payments to himself from the company's bank account.
Background
The Court of Appeal has recently referred to established case law that the court will only interfere with the act of an officeholder “if he has done something so utterly unreasonable and absurd that no reasonable man would have done it”.
While the judge in the lower court had not made any error of law, on the facts there were identifiable flaws in the judge's reasoning that the trustees' decision not to join in the proceedings was perverse.
The judge had failed to recognise that:
After a weekend that saw the tech ecosystem unite to fight for its future, on Monday 13 March 2023, the Bank of England (the Bank) effected the sale of Silicon Valley Bank UK Ltd (SVB UK) to HSBC. It used the resolution powers for stabilising failing banks granted by the Banking Act 2009 which were introduced following the 2008/9 financial crisis.
Resolution powers
The UK insolvency statistics released on 2 August for Q2 2022 (1 April – 30 June 2022) make for fairly sombre, if not entirely unsurprising, reading.
An 81% increase in corporate insolvencies in England and Wales from the same period in 2021 and a 13% increase in insolvencies from Q1 2022. The worst affected sectors are reported to include food, retail and construction.
On 16 September 2021, ordinance 2021-1193 implemented the European Directive on preventive restructuring frameworks into French law. The Ordinance applies to proceedings opened from 1 October 2021.
Key features
The UK High Court has excluded 'out of the money' creditors and shareholders from voting on Smile Telecoms Holdings Limited’s (Smile) restructuring plan because they did not have a genuine economic interest in the company.
Background
Background
The crisis exit treatment procedure has been introduced to provide a temporary judicial procedure for debtors encountering difficulties related to the pandemic and the financing of their activities. This excludes debtors that are structurally in distress.
The procedure enables debtors to adopt a repayment plan within a three-month period to resolve the company's financial difficulties. The procedure is subject to the rules governing judicial reorganisation proceedings with certain adaptations and exclusions.
On 1 October, Ordinance 2021-1193 introduced changes to the 'accelerated safeguard' procedure making this the 'preventive restructuring framework' as required by the 2019 Directive.
Certain conditions for the opening of an accelerated safeguard procedure have been retained with some modifications: