CB&I UK Ltd, Re [2024] EWHC 398 (Ch) (27 February 2024)

CB&I UK Ltd, Re [2024] EWHC 398 (Ch) (27 February 2024)

The plan constitutes a valid compromise or arrangement as it provides at least minimal consideration to dissenting creditors, satisfying the jurisdictional threshold. The 'no worse off' test is met because Reficar and other unsecured creditors would receive less in the relevant alternative (liquidation). The plan is fair, given the overwhelming support from secured creditors, the commercial reality of the group's financial distress, and the equity offered to Reficar in the parallel Dutch process. There is no breach of international obligations or inadequacy in the explanatory statement. The court exercises its discretion to sanction the plan, including the cross-class cram down.

Citation
[2024] EWHC 398 (Ch)
Parties
Applicant: CB&I UK Limited; Supporting Creditor: Crédit Agricole Corporate and Investment Bank; Supporting Creditor: Ad hoc group of supporting creditors; Dissenting Creditor: Refinería de Cartagena S. A. S. (Reficar)
Jurisdiction
England and Wales
Judgment Date
27 February 2024
Procedural Posture
Restructuring Plan Sanction Application (part 26 a Companies Act 2006) / Sanction Hearing and Judgment
Outcome
Plan sanctioned
Legal Topics
Restructuring Plan, Cross Class Cram Down, No Worse Off Test, Jurisdiction, Fairness of Arrangement, Recognition of Foreign Judgments
Insolvency Company Law Cross Border Restructuring Restructuring Plan Cross Class Cram Down No Worse Off Test Jurisdiction Fairness of Arrangement +1 more

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Parties

CB&I UK Limited

Applicant

Crédit Agricole Corporate and Investment Bank

Supporting Creditor

Ad hoc group of supporting creditors

Supporting Creditor

Refinería de Cartagena S. A. S. (Reficar)

Dissenting Creditor

Procedural Posture

Restructuring Plan Sanction Application (part 26 a Companies Act 2006) / Sanction Hearing and Judgment

Legal Issues

  1. 1 Whether the plan constitutes a 'compromise or arrangement' under s.901A(3) CA 2006
  2. 2 Whether the 'no worse off' test in s.901G(3) CA 2006 is satisfied for dissenting classes
  3. 3 Whether the plan is fair in its allocation of restructuring surplus

Ratio Decidendi

The plan constitutes a valid compromise or arrangement as it provides at least minimal consideration to dissenting creditors, satisfying the jurisdictional threshold. The 'no worse off' test is met because Reficar and other unsecured creditors would receive less in the relevant alternative (liquidation). The plan is fair, given the overwhelming support from secured creditors, the commercial reality of the group's financial distress, and the equity offered to Reficar in the parallel Dutch process. There is no breach of international obligations or inadequacy in the explanatory statement. The court exercises its discretion to sanction the plan, including the cross-class cram down.

Court Disposition

Plan sanctioned

Orders

  • The restructuring plan under Part 26A Companies Act 2006 is sanctioned.
  • The cross-class cram down provisions are applied to bind dissenting unsecured creditor classes.