Since our last newsletter, Russia's war in Ukraine rumbles on, domestic inflation hits new highs and there are signs of an increase in activity in the insolvency market. Russians unlawful assault on Ukraine continues unabated, as we enter the European summer months, and the fourth month of the invasion. Besides the utter devastation inflicted on the people and infrastructure of Ukraine, the war is having a significant impact on both global food and oil prices.
Summary
On 30 March 2022 the High Court sanctioned a restructuring plan for Smile Telecoms Holding Limited in which the court for the first time allowed the exclusion of all but one class of creditors from voting on a restructuring plan. The sanction hearing considered several salient issues around challenges made to a plan by a creditor or shareholder, questions of jurisdiction and the concept of a "compromise or arrangement" in Part 26A of the Companies Act 2006 ("CA 2006").
Background
OVERVIEW
Legislation
We are delighted to share with you our Financial Institutions Horizons 2021, which provides a snapshot of key legal topics and market trends across the globe, shaping the future of the financial institutions market.
Summary
In the recent Cayman Islands case of Re In the Matter of E-House (China) Enterprise Holdings Limited[1], dealing with creditors' schemes of arrangement, Justice Segal gave a helpful decision that provided judicial clarity on, among other matters, the potential impact of the recent sanctions regimes in the US, UK and Europe on the scheme, and the international effectiveness of the scheme.
In the recent Cayman Islands case of Re In the Matter of E-House (China) Enterprise Holdings Limited[1], dealing with creditors' schemes of arrangement, Justice Segal gave a helpful decision that provided judicial clarity on, among other matters, the potential impact of the recent sanctions regimes in the US, UK and Europe on the scheme, and the international effectiveness of the scheme.
The UK High Court has considered and granted permission for a so called “credit bid” in an application by the Special Administrators of Sova Capital Ltd (in special administration) for a substantial portfolio of illiquid Russian securities. The transaction structure, involving the transfer of securities in exchange for the release of a £233m claim against the estate, is unprecedented in the UK where ‘credit bidding’ has no technical recognition.
In a January 2023 opinion,1 the Southern District of New York Bankruptcy Court overseeing the bankruptcy case of Latin American airline Avianca and certain of its affiliates sanctioned over 150 of the airline’s Brazilian and Columbian creditors who had filed proofs of claim in the bankruptcy case finding t
CargoLogicAir Limited (the Company) was the UK's only all-cargo main deck freight airline. Due to sanctions imposed on its Russian owner, the Company was unable to effectively trade and pay its debts as they fell due despite obtaining a 'Basic Needs Licence'. Its sole director applied to appoint administrators.
Issues
The court considered two key issues: