EMEA R&I Insights
Company | Restructuring Tool/ Method | Court Involvement | Debt for Equity | Amend & Extend | New Money Ranking |
Schur Flexibles Group | Consensual Agreement | Out of Court | Yes | No | Secured |
Nordic Aviation Capital | Chapter 11 | In Court | Yes | Yes | Super Senior Secured |
Folli Follie Group | Consensual Agreement | In Court | Yes | No | Super Senior Secured |
Orpea (June) | Conciliation | In Court | No | No | Super Senior Secured |
ED&F Man | Part 26A Restructuring Plan | In Court | No | No | Super Senior Secured |
WiZink | Consensual Agreement | Out of Court | Yes | Yes | Super Senior Secured |
Lowen Play GmbH | Scheme of Arrangement | In Court | Yes | No | Senior Secured |
Nostrum Oil & Gas | Scheme of Arrangement | In Court | Yes | No | Senior Secured |
Smile Telecoms | Part 26A Restructuring Plan | In Court | No | Yes | Super Senior Secured |
Vue Scheme | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Scheme | Practice Statement Letter; Explanatory Statement; Convening Skeleton Argument |
The cinema chain had failed to recover from the effect of the Covid-19 pandemic. The company sought a scheme to amend the SFA to permit the insurance of £75 million in additional super senior debt. The financing would allow the company to pursue a wider restructuring via a debt for equity swap that was not part of the proposed scheme. The scheme was abandoned following a fully consensual deal. | The scheme would be coupled with a debt-for-equity swap undertaken using a Dutch share pledge enforcement, which requires approval from the Dutch court. After this the company intends to make an application to the English courts to appoint administrators over the company and use a pre-pack administration structure to effect a transfer of the group’s assets to a Newco. | A single class of creditors. | N/A |
Lowen Play Scheme | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Scheme | Lockup Agreement; Convening Skeleton; Sanction Skeleton; Convening Judgment |
The group’s €350 million 2022 senior secured notes reinstated in €220 million 2025 New SSNs and €130 million of holdco PIK notes. The New SSNs include a 4% original issue discount from face value. Bondholders provided €30 million of new money in the form of SSNs and will take 95% equity in the group. The group’s €40 million senior secured RCF will be repaid. | Prior to using the English law scheme process, the group used a consent solicitation to amend the governing law of the 2022 notes indenture to English law, which was approved by 99.55% of noteholders.It was the looming maturity of the group’s existing 2022 notes that affected its ability to continue as a going concern. The group was unsuccessful in attempting to refinance the 2022 notes during the summer of 2021. | The company proposed a single class comprising its senior secured noteholders. | N/A |
Amigo Scheme | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Scheme | Practice Statement Letter; Sanction Skeleton; Convening Bundle (including witness statements) Convening Skeleton |
Amigo proposed its second scheme of arrangement to compromise historic liabilities to customers for mis-selling loans. The previous scheme was denied on the basis that (i) creditors were not appropriately informed about why their rights were being compromised, (ii) the relevant alternative was not immediate insolvency, and (iii) shareholders retained their stake. | The second scheme proposed a dual structure. A new business scheme and a wind-down scheme in case the first option was not approved by creditors or the court. | A single class of creditors being the redress creditors was convened. | May 30, 2022 |
Haya Real Estate Scheme | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Scheme | Sanction Skeleton Argument; Convening Skeleton |
Facing a refinancing wall for more than €400 million of bonds, Spanish real estate company Haya proposed that existing noteholders would be redeemed in part, and the balance be released. The scheme creditors received a package comprising newly issued notes equal to the balance of the existing notes that were released; and (ii) shares in a new holding company of the group representing 27.5% of the equity on a fully-diluted basis. The new notes carry an extended maturity. | The judge was satisfied that the last-minute alterations to the scheme documents appended to the explanatory statement were not a “blot” on the scheme despite being “unusually large” in number. | A single class of senior secured noteholders was convened. | May 31, 2022 |
Nostrum Oil & Gas | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Scheme | Convening Skeleton; Sanction Skeleton |
The company proposed a debt for equity swap. The existing debt comprising $1.125 billion of unsecured notes will be swapped for a new $250 million senior secured bond and a $300 million senior unsecured note with the remaining debt equitized, leaving lenders with 88.89% of the share capital of the company. | Use of a “scheme standstill” structure to cater for uncertainty arising from the need to obtain EU and U.S. licenses before engaging with sanctioned entities. The standstill period lasts for six months during which creditors will not be able to enforce against the scheme company.A trust structure was created to allow the company to deal with dividends or other payments due to sanctioned creditors. | Single class of unsecured noteholders | Aug. 26, 2022 |
Hong Kong Airlines RP | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Plan | Company Skeleton | HK Airlines had proposed an inter-conditional U.K. restructuring plan and Hong Kong scheme of arrangement to restructure 30.069 billion Hong Kong dollars ($3.863 billion) of debt and avoid being wound up by its lessor creditors. The company has proposed three classes of affected plan creditors comprising (i) unsecured creditors, (ii) “critical” aircraft lessors and lenders and (iii) perpetual noteholders. | The mix of governing law raised the issue as to whether there was a sufficient connection with England and Wales. Issues pertaining to the Cape Town Convention were not required to be decided due to unanimity of voting. | Three classes of creditor | Dec. 9, 2022 |
ED&F Man RP | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Plan | Company Convening Skeleton; CoCom Convening Skeleton; Company Sanction Skeleton; Co-Com Sanction Skeleton. |
The commodity trading group sought to avoid breaking minimum cash covenants under its debt facilities. The group’s proposed restructuring involved raising a new $300 million trade finance credit facility, amending existing debt and introducing a new guarantee and security package. | The plan used the incentive of “elevation rights” to induce existing plan creditors to participate in the provision of new super senior money. Cross-class cramdown applied. | The plan company proposed five classes of creditor and two classes of shareholder | March 23, 2022 |
Smile Telecoms RP | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Plan | Company Convening Skeleton; Senior Lenders Convening Skeleton Company Sanction Skeleton |
The African telecoms provider appeared for its second Part 26A Restructuring Plan in two years. The purpose of the plan was to provide further super senior funding allowing the company to complete a controlled sales process and hand the equity in the company to the super senior creditor. Senior creditors were wiped out except for an ex gratia payment of $10 million. | The plan is the first ever to include an application to exclude a creditor class from voting on the proposal under section 901C(4) of the Companies Act 2006. A section 901C(4) application, which is heard at the convening stage of the plan, excludes “out of the money” creditors from voting on the plan at all and removes the need to cramdown creditors. It is clear from Smile that section 901C(4) will only be of use in “non-marginal” cases where the valuation evidence is clear. | Regarding creditor challenges, “Shouting from the sidelines” (in the words of Snowden LJ) is not an adequate way to express dissent. Creditors must participate in court and not rely on the scheme company or court to assert their rights on their behalf.Single class of creditors. | March 30, 2022 |
Houst Limited RP | |||||
Intel | Relevant Documents | Facts | Notable Features | Class Features | Sanction Date |
Plan | Restructuring Plan | The group proposed a simple compromise to debts owed to its two “in the money” creditors and an injection of new money by shareholders. | Houst’s plan is an example of quasi “cram-up,” where cross-class cramdown is used by junior creditors to impose a proposal on more senior creditors. Here, although the crammed-down party, HMRC, would technically rank behind the senior secured creditor (Clydesdale Bank) in an administration, HMRC would have received a higher financial dividend. The judgment is significant for middle market companies which may have previously considered the financial costs of a restructuring plan to be too high. | The group proposed six plan groups of creditors and members. | July 22, 2022 |
Scheme Company Name | Scheme Sanction Date | Lockup/ Consent Fee | AHG Working Fee | Backstop/ Underwriting Fee | Other Fees |
Swissport | June 24, 2020 | N/A | AHG fees not disclosed | Underwriting fee not disclosed | N/A |
Matalan | July 27, 2020 | N/A | N/A | 0.5% Underwriting fee for single creditor | 0.5% 1L consent solicitation (£1.74M), 0.5% 2L deferral fee |
Flint Group | July 30, 2020 | 0.5% (early bird) or 0.25% consent fee | N/A | N/A | N/A |
Hema BV | Aug. 24, 2020 | 1% lockup fee | N/A | N/A | N/A |
Codere Finance | Oct. 6, 2020 | 1% (early bird) or 0.5% consent fee | 1% work fee (€7.6M) | 2.5% backstop fee | 3% discount on interim notes, 2% enhanced coupon on interim notes, €6.75M advisor fees |
KCA Deutag | Nov. 5, 2020 | 0.15% lockup fee | 1.75% AHG work fee, 1.75% RCF work fee | N/A | N/A |
Swissport (Second Scheme) | Dec. 10, 2020 | 0.25% consent fee | N/A | 0.25% backstop fee | N/A |
Petra Diamonds | Jan. 12, 2021 | 1% lockup fee (paid in additional entitlements) | N/A | 5% backstop fee | 1% restricted period fee, reasonable costs of advisors |
PGS ASA | Feb. 2, 2021 | 0.25% (early bird) consent fee | 0.39%, $1.2M AHG work fee | N/A | 0.4% amendment fee, 1% additional fee, costs of advisors |
OHL | Feb. 5, 2021 | 2% lockup fee | N/A | Additional shares for backstop providers | N/A |
Lowen Play | May 5, 2022 | 0.25% consent fee | N/A | 4% backstop fee | All advisors' fees paid |
Haya Real Estate | May 31, 2022 | 0.5% consent fee | 0.3%, €1.25M work fee | N/A | 0.25% Consent Fee |
Plan Company Name | Plan Sanction Date | Lockup/ Consent Fee | AHG Working Fee | Backstop Fee | Other Fees |
Virgin Atlantic Airways | Sept. 2, 2020 | N/A | N/A | N/A | Reasonable costs of advisors |
Pizza Express | Oct. 29, 2020 | N/A | N/A | 5% backstop fee for AHG | Reasonable costs of advisors |
DeepOcean | Jan. 28, 2021 | N/A | N/A | N/A | N/A |
Gategroup | March 26, 2021 | N/A | N/A | N/A | Reasonable costs of advisors |
Virgin Active Ltd | April 29, 2021 | N/A | N/A | N/A | Challenging creditors fees: No final judgment provided. |
Smile Telecoms | March 10, 2022 | n/a (no lockup) | N/A | N/A | Reasonable costs of advisors |
ED&F Man | March 23, 2022 | 0.25% (early bird) consent fee | N/A | N/A | N/A |
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