Overview

As we enter a new era of ‘living with Covid’, new financial woes accompany new freedoms for many. Inflation is now at a 30-year high, with income failing to keep pace with the cost of living and interest rates rising twice in the last 4 months. A number of retailers, including Next, B&M and Greggs, have warned that soaring costs cannot be fully absorbed and will lead to price rises for consumers in 2022.

So, what is going on for retailers post-pandemic? And what steps can smaller, boutique brands take to mitigate the risks to their businesses going forward?

Introduction

Earlier this month, the English Insolvency and Companies Court (the “ICC”) made a limited civil restraint order against a shareholder who had repeatedly sought, unmeritoriously, to challenge the 2017 restructuring of Paragon Offshore plc (in liquidation) (“Paragon”) (Hammersley v Soden & Ors [2022] EWHC 223 (Ch)).

Following the 54% increase in the energy price cap announced by Ofgem on 3 February, and with many predicting that a second substantial increase may be required this October to keep pace with wholesale prices, what is next for beleaguered small energy suppliers?

There is a common misconception that lender liability is a thing of the past. However, a recent decision provides a warning to lenders that they can be held liable and face substantial damages if they exercise excessive control over a debtor’s business affairs.

There is a common misconception that lender liability is a thing of the past. However, a recent decision provides a warning to lenders that they can be held liable and face substantial damages if they exercise excessive control over a debtor’s business affairs.

The Insolvency Service published its latest company insolvency statistics at the end of January, reporting both on Q4 2021 as well as 2021 as a whole.

The statistics can be accessed here and we highlight some of the key takeaways below.

1. Q4 2021 Company insolvency statistics

Throughout the pandemic, a steady stream of government support was made available to prop-up businesses. As we move towards a New Normal, those support packages are being scaled-back. Many businesses are still recovering from the shock of the last 18 months and, with high levels of historic debt as an additional burden, are not yet back to full financial health.

In an opinion that mostly flew under the radar in 2021, Judge Christopher Sontchi from the Bankruptcy Court for the District of Delaware (the “Court”) found investment firm Yucaipa American Alliance Fund I, L.P. and Yucaipa American Alliance (Parallel) Fund I, L.P.

In an opinion that mostly flew under the radar in 2021, Judge Christopher Sontchi from the Bankruptcy Court for the District of Delaware (the “Court”) found a private equity sponsor (the “Sponsor”)¹ liable (and, in some cases, not liable) under various contractual and tort theories in connection with actions the Sponsor took or did not take in its failed efforts to stave off a potential bankruptcy filing of its portfolio company, Allied Systems Holdings, Inc., now known as ASHINC Corporation (“Allied” or the “Company