Light SA, Re
[2024] EWHC 2733 (Ch)
Arvos BidCo Sarl, Re
18 March 2024
[2024] EWHC 1016 (Ch)
High Court
A company with big debts asked a UK court to approve a plan to restructure its finances. The court checked that everyone was treated fairly and the plan made sense, then approved it. The plan involves getting new money, changing some loan terms, and canceling some debts.
Key Facts
- •Arvos BidCo S.à.r.l. (the Company), a Luxembourg-incorporated company, applied for sanctioning a scheme of arrangement under Part 26 of the Companies Act 2006.
- •The Company is part of a group involved in heat exchanging solutions with €532 million in debt under various loan facilities governed by English law.
- •The scheme involves €40 million of new capital, amendments to existing facilities, and a waiver of approximately €179 million of debt under Term Loan B facilities.
- •Creditors were divided into two classes: those under the revolving credit facility and ancillary facilities, and those under the Term Loan B facilities.
- •100% of creditors in the first class voted in favor, while 89.15% of the second class voted in favor.
Legal Principles
Sanctioning a scheme of arrangement requires compliance with statutory requirements, fair representation of each creditor class, bona fide actions of majorities, and the scheme being reasonably approvable by an intelligent and honest man acting in his own interests.
Part 26, Companies Act 2006
The Court considers the commercial sense of the scheme, the rationality of creditor votes, and the absence of defects.
Case Law (implied)
Jurisdiction of the English Court is justified by the English law governing the liabilities sought to be compromised.
Principles of Private International Law
Outcomes
The court sanctioned the scheme of arrangement.
The statutory requirements were met, creditor classes were fairly represented, majorities acted bona fide, the scheme made commercial sense, and no defects were identified.