Bankruptcy lawyers who are regularly involved in distressed m&a deals have been wondering for the past few months about the potential fallout from Philadelphia Newspapers.

Summary and implications

Almost exactly one year on from the Order* coming into force, many people remain unaware that it is no longer possible to appoint an administrative receiver over an overseas incorporated company.

Lenders and indeed insolvency practitioners should be aware that this is the case even when dealing with qualifying floating charges created before 15 September 2003 but alternative strategies, including administration, may be pursued to the same effect.

Administrative receivership

The chapter 11 case of DBSD North America, Inc. (“DBSD”), f/k/a ICO North America, has been marked by aggressive tactics and extreme positions from its commencement. DBSD, a non-operating satellite communications company, and its second lien noteholders made clear their intent to cram down a plan of reorganization (the “Plan”) on DBSD’s first lien lenders.