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Cross Border Insolvency Update - May 2019

Bundeszentralamt Für Steuern v Heis & Ors (as the Joint Special Administrators of MF Global UK Ltd)

The English High Court agreed to stay English insolvency proceedings in order that proceedings by the German Federal Tax Office could be dealt with by German Tax Courts. Similar applications for a stay brought by Deutsche Bank were however refused.

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Islandsbanki HF v Stanford [2019] EWHC 307 (Ch)

The appellant bank (IB) successfully appealed against a decision that three separate bankruptcy petitions (presented at different times) in relation to the same debtor should be heard together.

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British Steel enters Compulsory Liquidation

British Steel has been placed in compulsory liquidation, putting 5,000 jobs at risk and endangering a further 20,000 in the supply chain after the company was unable to reach an agreement with the UK government for emergency funding.

Private equity firm Greybull Capital bought British Steel for a nominal £1 during the steel crisis in 2016.

The Official Receiver has been appointed as Liquidator with accountancy firm EY appointed as Special Manager.

EY said the appointment of the Official Receiver followed "a number of weeks" of negotiations by management with the company's various stakeholders, including lenders, shareholders and the government, to secure the necessary funding to avoid an insolvency.

Luxury designer Roberto Cavalli seeks insolvency protection in the US

Art Fashion Corp, the North American branch of luxury Italian fashion brand Roberto Cavalli has recently filed for Chapter 7 bankruptcy protection in New York Southern District court.

Roberto Cavalli has requested 120 days to work with investors and agree a debt repayment plan. As part of this restructure, it is understood that the company has liquidated its US assets and announced the closure of all its US stores.

Financial reports show that Cavalli has been struggling to meet profit targets for several years and agreed to sell 90% of its shares to private equity firm Clessidra in 2015, with Roberto Cavalli keeping the remaining 10%. Clessidra began searching for additional investment in September 2018, saying that it "needed resources to overcome the difficult situation and to relaunch the business".

Jamie Oliver’s restaurant group goes into administration

Is the High Street breaking up? Jamie Oliver’s restaurant group is the latest business to go into administration with approximately 1,000 jobs being lost.

KPMG have been appointed as administrators with 22 restaurants (out of a total of 25 in the group) now closed.

The move follows other chains which have hit difficulties in recent years, such as Prezzo, Patisserie Valerie and Byron Burger.

For any more information please contact Alan Bennett or David Pomeroy from our Restructuring and Insolvency Team on a.bennett@ashfords.co.uk or d.pomeroy@ashfords.co.uk

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