CAREY OLSEN ON INSOLVENCY PROCESS
01 Sep, 2011
Successful Leadenhall Triangle insolvency process continues in Guernsey
Carey Olsen’s restructuring and insolvency team has recently and successfully completed the second phase of the Leadenhall Triangle insolvency process in Guernsey.
The team from Carey Olsen that has been advising the administrators on all aspects of the Guernsey administration regime includes lead partner Tim Corfield (pictured), partner Mark Dunster, senior associate Andrew Lister and associate David Jones.
Most recently, in the second phase of the insolvency process, the Carey Olsen team has advised on the successful transaction by which the underlying assets were realised at a level sufficient to pay secured creditors in full and to pay substantial dividends to unsecured creditors. During this phase, the team also successfully applied for the discharge of the administration orders and the appointment of the former administrators as liquidators to the remaining entities and continues to provide advice on the conduct of those liquidations.
In November 2010 the Carey Olsen team advised Hatfield Philips International Limited on its successful application for the appointment of two partners from PricewaterhouseCoopers (in both the UK and Guernsey) as joint administrators to a Guernsey corporate structure which ultimately held interests in the Leadenhall Triangle site in the City of London. The underlying lending in that structure was an historic £330m commercial mortgage backed security (CMBS) loan originated by Lehman Brothers.
David Jones commented: “There are an increasing number of CMBS structures, many of which were established using Channel Island registered entities, suffering breaches of banking covenants in the current economic climate and it is apparent in many cases that injecting new capital into those structures is problematic. The successful application of the administration legislation in Guernsey to a group and debt structure of this complexity is not easy, however this case has shown that with sufficient thought and the right advice, it can be used extremely successfully for the benefit of all creditors. The result achieved by the administrators in this case was well beyond realistic expectations given the extent of the structure’s apparent insolvency on first analysis. The outcome achieved is testament to the skill of the administrators and their advisors but also again demonstrates the flexibility afforded by the Guernsey regime and Courts.”
Advocate Corfield added: “There is no doubt as to the scale of the administrators’ success in this appointment. This further demonstrates the positive way in which joint appointments between office holders in diverse jurisdictions can be used to benefit creditors. Indeed, the experience of the Carey Olsen team, gained in multiple jurisdictions and in various disciplines, enables the firm to provide a full service to appointees in transactions of this magnitude and will continue to enable us to do so in difficult times ahead.”