Scheme update: fees, class composition and forum shopping in Re Codere Finance

By Matthew Thorn (UK) on November 17, 2020 Posted in Europe, UK

Introduction

Spanish gaming company Codere proposed an English scheme of arrangement to restructure over €800 million in existing note debt. As a part of the scheme, Codere agreed to pay fees and provide benefits to an ad hoc sub-committee of noteholders that were not available to all noteholders. The High Court held that those fees and benefits were not so material as to fracture the single voting class of noteholders. Re Codere Finance 2 (UK) Limited) [2020] EWHC 2441 (Ch) and [2020] EWHC 2683 (Ch).

The court also considered Codere’s incorporation of a new English subsidiary and the assumption by … Continue Reading

Global bankruptcy financial restructuring and insolvency group releases the Q4 2020 issue of International Restructuring Newswire

By NRF Digital Team on October 15, 2020 Posted in Canada, Europe, UK, US

Our global bankruptcy financial restructuring and insolvency team has released its quarterly International Restructuring Newswire.

Our team has published five articles examining new developments and a number of the tools available for financial restructurings in the United Kingdom, Germany, the Netherlands and Canada.

A DIP of the toe into US Chapter 11 waters for Australia

By Jeffery Black (AU) and Nick White (AU) on September 30, 2020 Posted in Australia

On 24 September 2020, the Australian Government announced the introduction of two new restructuring and insolvency processes for small businesses (having liabilities of less than AU$1 million). It is proposed that these measures will be introduced from 1 January 2021 with a view to reducing the cost, time and complexity burden imposed on small businesses by the existing insolvency processes. The Australian Government has described the changes as “the most significant changes to the Australian insolvency framework in almost 30 years.”

The changes represent the latest in a series of measures introduced in Australia this year in response to the … Continue Reading

The Insolvency, Restructuring and Dissolution Act 2018 – Reforming the law on contractual remedies

By Yu-En Ong, Pooja Balani and Katie Chung on August 21, 2020 Posted in Bankruptcy Courts, Involuntary Bankruptcy, Singapore

On 30 July 2020 Singapore’s new “omnibus” Insolvency, Restructuring and Dissolution Act 2018 (the Insolvency Act) came into effect. This marks the third phase in recent years to strengthen Singapore’s restructuring and insolvency laws.

The Insolvency Act consolidates the laws on insolvency, bankruptcy, restructuring and dissolution into a single enactment and introduces a number of changes to the restructuring and insolvency framework in Singapore including: (i) the introduction of a new licencing and regulatory regime for insolvency practitioners (liquidators, judicial managers and receivers); and (ii) enhancing the judicial management provisions to allow for a company to place itself into … Continue Reading

Modernising business registers and director identification numbers

By Natasha Toholka (AU) and Deborah Tsai (AU) on July 22, 2020 Posted in Australia

A package of five legislative reforms — Commonwealth Registers Bill 2019, Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019, Business Names Registration (Fees) Amendment (Registries Modernisation) Bill 2019, Corporations (Fees) Amendment (Registries Modernisation) Bill 2019, and National Consumer Credit Protection (Fees) Amendment (Registries Modernisation) Bill 2019 — received royal assent on 23 June 2020.

These amendments introduce significant changes to the management of Australian business information by Commonwealth bodies, and improve regulation of company directors through the introduction of Director Identification Numbers.

A New register

The Commonwealth Registers Act 2020 (Cth) combines the Australian … Continue Reading

Directors Can Stop the Zombie Company Pandemic

By Scott Atkins (AU) and Dr. Kai Luck (AU) on May 25, 2020 Posted in Australia

In the article, “Will the real zombie please stand up? The opportunity for directors to take control,” Scott Atkins and Dr Kai Luck continue their analysis of the risk that global fiscal stimulus and support measures in response to COVID-19 will be used by some entities to continue trade even when they have no realistic prospect of long-term profitability.

There are personal liability laws for directors that should now provide directors with an incentive to seek assistance from expert restructuring advisers to assess a company’s viability and, if its downturn is endemic, to look to formal insolvency options.

Directors who … Continue Reading

VIDEO – Use of schemes as UK debt restructuring tools

By Matthew Thorn (UK), Mark Craggs (UK) and Grace Carpenter (UK) on May 22, 2020 Posted in UK

Our video, Use of schemes as UK debt restructuring tools, provides insight into the circumstances in which schemes can be used in restructuring transactions where there are minority hold-out creditors and it is not possible to reach unanimous (or near-unanimous) approval thresholds for desired amendments to the finance documents and/or the capital structure.… Continue Reading

The new pandemic: Zombie companies will eat Australia’s COVID-19 economic recovery

By Scott Atkins (AU) and Dr. Kai Luck (AU) on May 21, 2020 Posted in Australia

In this article, Scott Atkins and Dr Kai Luck consider how the extraordinary government fiscal and stimulus measures introduced in response to COVID-19 may provide an incentive for so-called zombie companies—those that were facing endemic operational and liquidity issues pre-crisis and that have no realistic prospect of successful trade in the long-term—to continue on for the next 6 to 12 months, preventing the recycling of important capital needed to reinvest in the innovative new business ventures that will drive economic recovery and eventual growth.… Continue Reading

COVID-19: From black swan to boiling frog

By Scott Atkins (AU) and Dr. Kai Luck (AU) on May 20, 2020 Posted in Australia

Scott Atkins and Dr Kai Luck examine in this article how underlying corporate governance and risk failures may have contributed to boards being caught so off-guard by COVID-19 and how COVID-19 ‘tunnel vision’ (focused only on pandemic-related business continuity and risk management plans) may lead to companies being exposed to equally devastating risks in other contexts—including climate change and cybersecurity—as the economic recovery period commences across the globe.… Continue Reading

The shift we needed: The fight to save Virgin already changing corporate rescue laws in Australia

By Scott Atkins (AU) and Dr. Kai Luck (AU) on May 19, 2020 Posted in Australia

In this article, Scott Atkins and Dr Kai Luck look at the important role Australian courts can play in creating a stronger corporate and business rescue culture to help financially distressed but long-term viable entities navigate the economic downturn caused by COVID-19.

Since this article was written, the Federal Court of Australia granted further orders on 13 and 15 May 2020 exempting the voluntary administrators from personal liability for new contracts entered into as they seek to restructure the Virgin entities (which operate Australia’s second major airline) with a view to a going concern sale to a third party.

Looking … Continue Reading