Much will depend on the specifics of a company’s financial position, but there are some themes from the OutsideClinic and Enzen judgments that are helpful – and arguably so even beyond the context of RPs for a company’s managing its relationship with HMRC. Is HMRC in or out of the money? In OutsideClinic HMRC had … Continue Reading
The Outside Clinic restructuring plan (RP) was sanctioned last week with HMRC voting in favour of it. In a similar vein to Enzen (see our earlier blog) HMRC initially indicated that it was not inclined to support the plan, but, after negotiating a higher return following the convening hearing, it voted in favour of it. A … Continue Reading
You may have read our previous blog about the Outside Clinic Restructuring Plan (RP) which asked whether 5p was enough to cram down HMRC and thought, well surely if that’s not enough, 10p would work? The Enzen Restructuring Plans (RPs) that were sanctioned this week also sought to compromise HMRC’s secondary preferential debt proposing a … Continue Reading
For those in the mid-market who have watched developments in restructuring plans (RP) move from a potential rescue tool, to something prohibitively expensive, the OutsideClinic RP might be one to watch. Not least because the RP seeks to cram down HMRC. Following RPs proposed by Naysmyth and the Great Annual Savings Company (which were unsuccessful … Continue Reading
In his judgment to sanction the restructuring plan (“RP”) of Revolution Bars[1], Justice Richards proceeded on the basis that the Class B1 Landlords and the General Property and Business Rate Creditors were dissenting classes, notwithstanding that they approved the Plan by the statutory majority. This is because they did not approve the Plan at “meetings”, … Continue Reading
For those unfamilar with the various insolvency processes it is not always easy to differentiate between them. In our latest insight we have produced a quick guide to administration that explains the procedure, benefits and effect of administration on third parties, including employees, suppliers and landlords. Our quick guide also explains the administrator’s role and … Continue Reading
On 7th February 2024, Mr Justice Richards heard closing submissions in the English High Court for a contested sanction hearing for Aggregate Group’s Part 26A restructuring plan. This hearing presented one of the first opportunities to analyse how the Adler decision will affect restructuring plans going forward.… Continue Reading
On 23 January 2024, the Court of Appeal handed down its much anticipated judgment[1] on the appeal of the Adler restructuring plan pursuant to Part 26A of the Companies Act 2006 (“RP”), which was sanctioned by the High Court on 12 April 2023[2], with judgment setting out the reasoning for that decision handed down on … Continue Reading
The judgment handed down in the matter of CB&I UK Ltd suggests that the English Courts will not expedite or truncate sanction hearing timetables to accommodate requests from companies which have applied for a restructuring plan under Part 26A of the Companies Act 2006 (“Restructuring Plan”) unless there are good reasons for doing so. Distressed … Continue Reading
What can we say about the outcome of the GAS (Great Annual Savings Company Limited) sanction hearing that hasn’t already been reported? It’s impossible not to comment on the fact that the plan was not sanctioned, and as a consequence of fierce opposition from HMRC that it avoided cram down. Nor that the court refused … Continue Reading
Yesterday saw the end of a three-day sanction hearing for the restructuring plan (the “Plan”) of the Great Annual Savings (GAS) company, with Justice Adam Johnson reserving his judgment and importantly, his decision on whether to exercise cross-class-cram-down to sanction the Plan for a later date. As we discussed in our recent blog, the Plan … Continue Reading
‘If, at first, you don’t succeed, then try and try again’ is a fitting description for HMRC’s recent approach to restructuring plans, with its opposition of plans proposed by The Great Annual Savings Company (GAS) and Nasmyth Group Limited (Naysmyth). The GAS sanction hearing (which is due to take place this week) will be the … Continue Reading
Following the sanctioning of the Good Box restructuring plan (RP) it seems the answer is yes. This might sound surprising to those familiar with schemes of arrangement, because that outcome is at odds with the long-standing decision in Re Savoy Hotels. For those less familiar with schemes and scheme case law, the court declined to … Continue Reading
It is difficult to predict what 2023 might hold for businesses in the UK. Given the difficult economic environment, many will already be facing a challenging start to the year. Although the challenges of the pandemic (such as lock downs) have gone, others have materialised. Energy price hikes and inflation rises continue to make trading conditions tough. At some point in 2023 affected businesses may have to restructure, and others may need to enter a formal process. … Continue Reading
There has been very little to indicate how HM Revenue and Customs (“HMRC”) might approach a restructuring plan (RP), following HMRC’s preferential status being restored in 2020. The reinstatement of HMRC as a preferential creditor potentially makes company voluntary arrangements non-viable if HMRC do not support, but what about RPs? RPs introduced for the first … Continue Reading
The perceived costs of proposing a restructuring plan are seen to be the biggest inhibitors to using the process for SMEs. It is still a relatively new tool and insolvency practitioners, lawyers and the courts are still grappling with it, but as we have seen recently in Amigo Loans it can provide creative and innovative … Continue Reading
Smile Telecoms Holdings Limited (“Smile”), a Mauritian company, has recently had its second restructuring plan sanctioned by the High Court in England. The case contains some important markers for those involved in restructuring plans, particularly those plans which involve international elements or which seek to prevent out-of-the-money creditors from voting on the plan. Background Smile’s … Continue Reading
At the end of 2021, the Spanish government approved draft reforms of the Spanish insolvency laws that transposes Directive (EU) 2019/1023 of 20 June 2019 on preventive restructuring frameworks into Spanish law. The reform will bring about a comprehensive change in insolvency proceedings in Spain. So what are these changes and what effect will these … Continue Reading
A restructuring plan may well be a very effective way of restructuring a foreign company. It has several advantages over a scheme of arrangement and with a relatively low entry threshold, the English court has already sanctioned at least one plan for a foreign company in the relatively short time that it has been available. … Continue Reading
Opening the door for the SME market, Sir Alistair Norris has sanctioned the first ever restructuring plan for a “mid-market” company. The plan sanctioned in Amicus Finance PLC (in administration) is also the first restructuring plan proposed by insolvency practitioners and the first to cram down a secured creditor. The sanction judgment is short, but … Continue Reading
