Cross-Border Restructuring Matters

Home
Practices and industry sectors
Practices
Restructuring, Insolvency and Bankruptcy
Cross-Border Restructuring Matters

Cross-Border Restructuring Matters

{6F93CFB6-10C8-4330-8A3F-42C6ABCEA2BB}

Restructuring and insolvency pose difficult issues to face even when the legal regimes and customs are local. Complexity is magnified and expected business opportunities can appear hidden when transactions and recoveries travel across jurisdictional boundaries. The larger the stakes and the more borders crossed, the more access to substantial experience, inventive thought and practical cultural sensitivity is required.

The guidance of experienced partners at Dentons permits you to rely on the practical and integrated judgment of a global team with a robust track record, working within and between restructuring regimes and jurisdictions worldwide. Secure in the knowledge that the firms’ partners operate as a single unit with the client, favorable restructuring of sovereign and other debts are achievable, prosecution or defense of foreign proceedings is expected and pursuit of out-of-court and alternative dispute resolution avenues when appropriate is second nature. Preservation and protection of valuable assets, such as intellectual property and governmental licenses, can be achieved by those with an intimate knowledge of local, domestic and cross-border regimes. Trusted multilingual and culturally adept partners routinely handle intricate problems through formal and informal procedures and concurrent proceedings, including:

Recognition of foreign representatives and foreign proceedings
Migration of foreign business as part of successful restructurings
Representation of governmental and other fiduciaries across borders
Interaction with official, unofficial and ad hoc groups of multijurisdictional creditors and shareholders
Enforcement of creditor rights and remedies in multiple jurisdictions
Protection of foreign investments and recoveries in multiple jurisdictions

Represented locally by professionals in the world’s major financial centers, Dentons is intimately familiar with key laws, regulations and practices, including the UNCITRAL Model Law on Cross-Border Insolvency, the European Community Regulation on Insolvency Proceedings, the UK Cross-Border Insolvency Regulations 2006 and Chapter 15 of the US Bankruptcy Code.

Experience

Bank Polska Kasa Opieki, Bank Handlowy w Warszawie, mBank and ING Bank Śląski: Advising on the restructuring and increase of the amount of the circa US$147 million / PLN 495 million multipurpose financing provided to Inter Cars, the biggest automotive spare parts distributor for passenger cars, commercial vehicles and trucks in Middle-Eastern Europe. The transaction was complex due to its legal structure, multijurisdictional character and the number of parties involved. Dentons provided legal support in five jurisdictions, namely in Poland, Ukraine, the Slovak Republic, Romania and the Czech Republic.
Bluberi Technologies, Inc.: Representing this major designer and developer of gaming technology and equipment, and its subsidiaries, in Chapter 15 proceedings in the US Bankruptcy Court for the Northern District of Illinois and in parallel Companies' Creditors Arrangement Act proceedings in Montreal.
Dr. Alfred Schefenacker: Advising as shareholder of Schefenacker AG within a cross-border restructuring concept in the framework of an English Company Voluntary Arrangement (CVA) connected with a debt-to-equity swap.
Energia Overseas: Representing a Russian reorganization sponsor and Chapter 11 debtor-in-possession funder for Sea Launch that resulted in Sea Launch shedding over US$2 billion in debt and migrating with regulatory approvals in several steps from Delaware to Switzerland. The deal involved lawyers from our US and UK offices and we also directed counsel in Luxembourg, Switzerland, Cayman Islands, Isle of Man and Bailiwick of Jersey.
ERP Compliant Fuels, LLC: Representing this natural resources company focused on the acquisition of assets within the coal, iron ore and steel making cycles in multiple transactions. The book value of assets involved in each of these representations range from hundreds of millions to billions of dollars. Dentons has been awarded The Global M&A Network’s 2017 "Turnaround Atlas Award" for Cross-Border Turnaround of the Year in connection with the representation of Conuma Coal Resources Limited in its acquisition of Walter Energy Canada assets and the "Turnaround Atlas Award" for Community Impact for ERP Iron Ore, LLC's acquisition of Magnetation. Both purchasers are members of the ERP Compliant group.
Fagor Mastercook S.A.: Advising one of the largest banks in Poland on the bankruptcy of Europe's fifth largest appliance maker, Poland-based Fagor Mastercook S.A., declared in Spain. Work included analysis of the bank’s position as a creditor in the bankruptcy proceedings governed by Spanish law, the possibility of pursuing claims under a bank guarantee and corporate guarantees granted by the parent company–Fagor Electrodomésticos S. Coop. (also declared bankrupt in Spain) and claim filings within both insolvency proceedings. This bankruptcy case is a rare example of a situation where the main bankruptcy proceedings with respect to a Polish company were opened abroad.
Lehman Bankhaus German (affiliate of Lehman Brothers Holdings, Inc.): Representing in its complex claims against, and transactions with, other Lehman entities. We also represent numerous other clients in a wide variety of matters worldwide arising out of the Lehman collapse, including hedge funds and other financial institutions in connection with the administration of the English Lehman companies. This is especially true in relation to prime brokerage issues and International Swaps and Derivatives Association close-out positions.
LightSquared LP: Acting as lead Canadian insolvency counsel in a multi-billion dollar cross-border proceeding commenced under US Chapter 11 and recognized under the CCAA.
Montréal, Maine & Atlantic: Acting as counsel to directors, officers and certain related companies of US and Canadian cross border debtors Montréal Maine & Atlantic Railway, Ltd. and Montréal Maine & Atlantic Canada Co. in simultaneous cross-border insolvency proceedings arising from the derailment of 72 tanker cars carrying Bakken crude oil through eastern Quebec, resulting in 47 casualties and hundreds of millions of dollars of property and environment claims. A mass tort case that achieved an unprecedented CA$450 million settlement fund to be administered jointly between the debtors' US and Canadian estates.
Nortel Networks Inc: Serving as Canadian counsel for the Official Committee of Unsecured Creditors and certain of its direct and indirect subsidiaries in the cross-border CCAA/Chapter 11 proceedings.
Northstar Aerospace (USA), Inc.: Serving as debtors’ counsel in the Chapter 11 case of Northstar Aerospace (USA), Inc. and its affiliates, which filed for bankruptcy in Delaware. The matter resulted in a going concern sale of both the US and Canadian assets for approximately US$120 million of cash and assumed liabilities. There was also a complex international arbitration post-closing related to purchase price adjustment related disputes.
PT Berlian Laju Tankers group (Singapore): Advising a Singapore-registered Business Trust in the insolvency and scheme of arrangement in Singapore and US Chapter 15 bankruptcy protection measures taken by companies in the PT Berlian Laju Tankers group. This is one of the highest profile, widely reported insolvency cases in the maritime world. The PT Berlian Laju group defaulted on a US$685 million loan agreement.
Sea Containers, Ltd.: Representing a UK pension scheme asserting shortfall claims against an affiliated holding company that was a debtor in US Chapter 11 proceedings. The scheme obtained a Financial Support Direction (FSD) from the UK Pension Regulators against the holding company - one of the first issued - and then used that FSD to negotiate a settlement that delivered a recovery to the scheme that exceeded that otherwise provided by the UK Pension Protection Fund when winding up and was a case of first impression in the US bankruptcy court.
Setanta Sports and Deloitte: Advising digital TV sports broadcaster in its attempt to negotiate and implement a financial restructuring and, subsequently, acting for Deloitte as administrators of the group, which had operations in England, Ireland, Luxembourg, Australia and the US. The English companies went into administration in England, the Irish companies into receivership in Ireland, and we made a successful application to the English court to take the Luxembourg company into administration in the UK, on the basis that its center of main interests had migrated to England over time. The international businesses were preserved and sold by the administrators.
Swedbank: Representing in multiple International Swaps and Derivatives Association (ISDA) and foreign exchange transaction disputes with various Lehman Brothers entities, including an appeal of first impression from an order issued in the Lehman Brothers Holdings Inc. reorganization case. The bank asserted a right to setoff funds transferred into the debtor's deposit account after the commencement of the reorganization case against the debtor's pre-petition obligations to the bank under various financial contracts. On appeal, the bank sought determinations that the “safe harbor” provisions of the US Bankruptcy Code permitted the bank to exercise its setoff rights against the deposit notwithstanding any other Bankruptcy Code provision that Lehman argued would limit such rights.
UC Rusal: Advising the facility agents and lenders on the impact of the RUSAL restructuring on their facilities to the RUSAL Group, the world's largest aluminium company. The restructuring involved US$7.8 billion of debt from overseas banks, over US$6 billion of deferred payment and contingent liabilities to Onexim, with the remainder owing to local Russian lenders. We advised 49 of the 70 overseas banks involved in the restructuring. (Deal of the Year 2009, Trade & Forfaiting Review).

Insights

Impact of the pandemic on the world’s healthcare systems

June 1, 2023

In our first PodChat episode, Nora Wouters and Lynn Harrison introduce our distressed health care series. Samuel Maizel and Daniel Fritz discuss the following topics as it relates to the impact the pandemic has had on the world’s health care system: ownership and fee structures in the US/Germany, impact of COVID on revenues, pre-COVID problems merging with post COVID-issues.

Follow the Yellow Brick Road: The Single Point of Entry and Chapter 15

September 22, 2021

Recently, there has been a divergence of opinion when it comes to whether a foreign liquidator must commence a Chapter 15 case before seeking comity in the United States (the “US”).

UPDATE: Fairfield Sentry Revisited: Beyond the rhetoric of approach, US safe harbor provisions continue to apply to analogous foreign avoidance claims

May 26, 2021

In March 2021, Dentons published, “Fairfield Sentry: A look into the application of the US safe harbor provisions and the Hague Convention to foreign claims,” (available here) which examined the December 14, 2020 memorandum decision issued by now-retired Judge Stuart Bernstein of the US Bankruptcy Court for the Southern District of New York (the “Court”) in In re Fairfield Sentry Ltd. (the “Fairfield Sentry Decision”).

View all insights for Cross-Border Restructuring Matters