Topic: Cramdown

A company voluntary arrangement on steroids, or a tool that gives Goliath license to squash David? Lawyers on the debtors’ and landlords’ side give their take on Virgin Active’s freshly-sanctioned restructuring plans: the first to compromise lease liabilities, with the most extensive cram-down seen to date.

13 May 2021

Gym chain Virgin Active’s heavily contested restructuring plans have been sanctioned in a judgment affirming that English courts will afford weight to the decisions of higher-ranking creditors when exercising their discretion over cross-class cramdowns.

12 May 2021

Minutes before the end of Virgin Active’s five day-long contested plan sanction hearing, the court heard that the owner of one of its gym sites had served forfeiture proceedings because it said it would do better re-letting its West London premises afresh than under the plans.

05 May 2021

On the fourth day of its contested UK plan hearings, counsel to Virgin Active, its secured lenders and opposing landlords clashed on how far the courts should assess the merits of restructuring plans: does satisfaction of the two conditions in Part 26A give the company “a fair wind”, or should the court be looking to see if something better is “waiting in the wings"?

04 May 2021

Virgin Active’s contested plan sanction hearing continued through the May bank holiday with Mr Justice Snowden asking counsel for terms of reference on how to gauge whether its plans are just and equitable - noting that the gym chain appeared to be arguing “quite a broad proposition” that higher ranking creditors can determine how the group's value should be divided.

03 May 2021

Kirkland & Ellis and Deloitte are advising Japanese-owned car park operator NCP as it follows gym chain Virgin Active in using a UK restructuring plan to deal with property leases – meanwhile the High Court has weighed in on who should pay objecting landlords’ costs in restructuring plan cases.

16 April 2021

While the government has extended its protections for commercial tenants once more, partner Roger Schofield, counsel Katharina Crinson and associate Nicholas Cooper at Freshfields Bruckhaus Deringer in London say it’s a matter of “when” not “if” the UK will see more CVAs – and potentially restructuring plans – targeting rental obligations.

18 March 2021

To say the least, 2020 was a tumultuous year and its effects will be felt economically and socially for many years to come. Although 2021 promises some improvement, disruption seems inevitable. Given the many unknowns lying ahead, partners John Whiteoak and Kevin Pullen at Herbert Smith Freehills have compiled a list of themes for GRR readers to look out for in the UK in the coming year.

04 February 2021

The cross-class cram-down mechanism introduced in the UK last year has been applied for the first time, after the English High Court sanctioned three restructuring plans for Dutch subsea services provider DeepOcean Group.

13 January 2021

Mr Justice Snowden has said he will be looking to existing principles of UK insolvency law to guide the exercise of the court’s discretion under the new Part 26A restructuring plan, rather than simply adopting techniques used in other jurisdictions - as he predicted a rise in work for valuation experts before the English courts.

19 November 2020