European Real Estate Finance: Market Update – Q1 2021 March 2021 Authors: Jeffrey Rubinoff, Dr. Thomas Flatten, Thierry Bosly, Hadrien Servais, Carl Hugo Parment, Fernando Navarro, Christophe Goossens, Julio Peralta, Angel Calleja, Aurélie Terlinden, Alexandra Stolt, Amitaben Patel & Brendon Vyas Further information on the response to COVID-19 can be found here, and we also have a German-language article, available here, looking at the impact on commercial leases. LIBOR Discontinuation Much has happened in the world of LIBOR Discontinuation since our last update.
The Court of Appeal of Alberta issued the latest decision in the Companies’ Creditors Arrangement Act (CCAA) proceedings of Bellatrix Exploration Ltd. (Bellatrix).1
The Kingdom of Saudi Arabia overhauled its corporate insolvency framework in 2018 with the introduction of a new bankruptcy law. In this client alert we examine the new Bankruptcy law in detail.
Executive Summary
The economic impact of the COVID-19 pandemic led to a wave of creditor schemes of arrangement ("schemes") and restructuring plans ("RPs") in the second half of 2020, which shows no sign of abating in 2021. For the uninitiated, the scheme (a long-established tool) and the newer RP process are court led UK restructuring options that a company can use to bind a minority of creditors into a restructuring. An RP can also be used to "cram down" an entire dissenting creditor class into a deal where certain conditions are met.
In 2020, commercial chapter 11 bankruptcy filings climbed to their highest levels in recent years, as COVID-19 disruption sparked sharp declines in GDP and volatile stock market swings. Notably, the pandemic accelerated the restructurings of some companies that were already on the precipice of financial distress, particularly in the retail, energy, travel and hospitality sectors.
A report about the administrative practice of the German Takeover Panel in the last decade
The exemption from the requirement to launch a mandatory offer based on the restructuring of a target company is the most frequently applied exemption from the mandatory offer procedure in German takeover law. In view of the expected increase of restructuring cases due to the COVID-19 pandemic, it is likely to become even more important.
Part 1
Without question, the top story over the last year has been the COVID-19 pandemic and its tremendous ongoing effects felt across Canada and the world.
This time has had a significant impact on Canada’s energy industry and many of the changes and developments that took place in 2020 will continue to influence trends, business decisions and the future growth of Canada’s energy industry in 2021.
In the recent decision in PricewaterhouseCoopers Inc. v Perpetual Energy Inc., 2021 ABCA 16 (Perpetual Energy), the Alberta Court of Appeal has reversed the Honourable Justice D.B. Nixon’s decision, striking out or summarily dismissing claims by PricewaterhouseCoopers Inc. in its capacity as trustee in bankruptcy (the Trustee) of Sequoia Resources Corp. (Perpetual/Sequoia).
General partner-led fund restructurings accounted for the majority of private equity secondaries volume in 2020 as managers sought liquidity in a flat exit market
Private equity (PE) fund general partners (GPs) faced a challenging year for returning cash to their investors, leading many to turn to GP-led fund restructurings to create liquidity for investors as fund lives expire.
HEADLINES
- In March 2020, credit insurer Euler Hermes forecast a 43% increase in insolvencies in the UK in 2021, as well as a 26% uptick in France and 12% in Germany
- By December 2020, ratings agency S&P was forecasting European defaults rising to as much as 8% by the end of 2021
There have been fewer European insolvencies and restructurings than anticipated during the COVID-19 pandemic, but distressed deal activity may accelerate as soon as economies are finally able to reopen.