In the Matters of Apcoa Parking Holdings GmbH and Apcoa Parking Deutschland GmbH (Companies Incorporated in Germany) and Others
| Jurisdiction | England & Wales |
| Judge | Mr Justice Hildyard,The Honourable Mr Justice Hildyard |
| Judgment Date | 19 November 2014 |
| Neutral Citation | [2014] EWHC 3849 (Ch) |
| Docket Number | Case Nos: 6596, 6599, 6600, 6601, 6604, 6607, 6610, 6611 and 6613 of 2014 |
| Court | Chancery Division |
| Date | 19 November 2014 |
[2014] EWHC 3849 (Ch)
The Honourable Mr Justice Hildyard
Case Nos: 6596, 6599, 6600, 6601, 6604, 6607, 6610, 6611 and 6613 of 2014
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
COMPANIES COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr William Trower QC and Mr Adam Goodison (instructed by Clifford Chance) for the Scheme Companies
Mr David Allison QC (at the Convening Hearing) and Mr Jeremy Goldring QC (at the Sanctions Hearing) (instructed by Kirkland & Ellis International LLP) for Centerbridge
Mr Richard Snowden QC and Mr Daniel Bayfield (and Mr Adam Al-Attar at the Sanctions Hearing) (instructed by Jones Day) for FMS
Hearing dates: 22–24 September 2014 (Convening Hearing);
–22 October, 27, 29 & 30 October (Sanctions Hearing)
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Mr Justice HildyardIntroduction
Nine bodies corporate (each a "Scheme Company" and together "the Scheme Companies") in a group called the Apcoa Group, a leading pan European car park operator with (as at the end of July 2014) some 5,000 employees, have applied to this court for the purposes of obtaining its sanction to schemes of arrangement to effect a restructuring which is considered essential to enable the Apcoa Group to avoid formal insolvencies and their associated value destruction for all creditors.
The applications are in the case of each Scheme Company made by a Claim Form issued on 18 September 2014 pursuant to CPR Part 49 and seeking (1) orders convening meetings of certain of its creditors for the purpose of considering and, if thought fit, approving a scheme of arrangement under Part 26 of the Companies Act 2006 ("Part 26") and, if so approved, (2) the Court's sanction of such scheme (together "the Schemes") and further requisite directions.
The Schemes are inter-conditional: if one fails they all fail. Their sanction has throughout been presented as a matter of great urgency. The repayment date of the facilities sought to be reconstructed was 25 October 2014, and although a short extension was agreed when it became clear that the matter could not be concluded, it cannot be extended for long. Further, on 25 November 2014, the offer of new facilities on which the Apcoa Group reconstruction depends expires.
At each stage of the court process the Schemes have been opposed by an assignee of a creditor of the Scheme Companies under a facilities agreement originally dated 23 April 2007 and entered into by the Apcoa Group's holding company, Apcoa Parking Holdings GmbH ("APHG"), Mizuho Bank, Ltd and Royal Bank of Canada as mandated lead arrangers, Mizuho Bank, Ltd as agent ("the Existing SFA Agent") issuing bank and security trustee ("the Security Trustee") and the lenders named therein ("the Existing SFA Lenders" as amended and/or restated from time to time ("the Existing SFA")). The opposing creditor by assignment is FMS Wertmanagement Anstalt öffentlichen Rechts ("FMS").
On 29 September 2014, after a contested hearing in the long vacation which lasted nearly three days, I made orders convening meetings of creditors in each case as proposed by the relevant Scheme Company. I gave a short ex tempore ruling. I indicated that I would amplify my reasons in a reserved judgment.
The class meetings convened and held pursuant to my order duly took place on 13 October 2014 and approved the Schemes by the requisite majorities.
The matters came back before the court on 20 October 2014 for the purpose of obtaining the court's sanction for each Scheme. That contested hearing spanned four days, and included a day of cross-examination of two expert witnesses on German law for reasons I shall later explain.
By reference to commercial exigencies of which I was assured (but which were not explained) I was pressed to provide a determination on or before 29 October 2014, on the basis that if necessary my full reasons would be provided in a reserved judgment later. Accordingly, on 29 October 2014 I gave my determination. I declined to approve the Schemes in their then form, because of two features I considered beyond my jurisdiction to approve, and which in any event (if I was wrong about the extent of the court's jurisdiction) I was not content to approve in the exercise of my discretion. However, I indicated that but for those two features I would sanction the Schemes.
On 30 October 2014, after amendments had been made to the proposed Schemes to address the two matters that had caused me to decline my sanction, I sanctioned all the Schemes. I indicated that I would provide my reasoned judgment explaining my decisions at each stage of the court process. In view of the continuing urgency the parties politely and understandably asked me to deliver it as soon as possible. This is my reasoned composite judgment.
Although I should acknowledge regret in my own case that pressures of time have probably led to an excessively long judgment, it will also be apparent from the length of the hearings (as well as the number of files, including four of authorities) that these Schemes raise issues of complexity and importance, and some novelty. There are issues raised which seem to me to go both to the root of the jurisdiction and its availability and exercise in a cross-border context.
It is unusual also that a scheme should be contested at every stage; and the adversarial process inevitably shines light on issues that in unopposed matters may not have been so sharply exposed. In refusing permission to appeal I do not wish to be understood to underestimate the importance of the points: I considered as a pragmatic matter that in the urgent circumstances the future conduct of the matter should be left to the Court of Appeal to determine.
Although I refused permission to appeal largely for pragmatic reasons (which I sought to explain in a separate ruling), I required the parties to develop mechanisms to ensure that any appeal would not be rendered nugatory, and that my decision to sanction, if found to be in error, could fully be reversed. I much appreciated their cooperation in this.
The Parties
The persons interested and represented in court were as follows.
The nine Scheme Companies who have sought to restructure their indebtedness under the Schemes and pursuant to Part 26 are:
(1) APHG and
(2) Apcoa Parking Deutschland GmbH ("APD"), both incorporated in Germany;
(3) Apcoa Parking Austria GmbH, which is incorporated in Austria;
(4) Apcoa Parking Belgium N.V, which is incorporated in Belgium;
(5) Apcoa Parking Holding Danmark ApS, which is incorporated in Denmark;
(6) Apcoa Parking Holdings (UK) Limited and
(7) Apcoa Parking (UK) Limited ("APL"), both companies incorporated in England and Wales;
(8) EuroPark Holdings AS and
(9) EuroPark Scandanavia AS, both of which are incorporated in Norway.
The Scheme Companies have been represented throughout the court process by Mr William Trower QC and Mr Adam Goodison, instructed by Clifford Chance.
As well as FMS, another body corporate appeared at both stages of the court process, namely Centerbridge Partners ("Centerbridge"), which is the largest creditor of the Apcoa Group. Centerbridge appeared at the first stage of the court process by Mr David Allison QC, and at the second stage by Mr Jeremy Goldring QC, instructed by Kirkland & Ellis International LLP.
In contrast to FMS, Centerbridge has throughout been highly supportive of the Schemes. Indeed, FMS contends that Centerbridge is the real mastermind and driving force of the Schemes, and that it has contrived them and their urgency in pursuit of its own commercial objectives as a specialist in distressed debt investment with a "loan to own" strategy or model of buying distressed loans at a significant discount and then seeking to swap the debt for equity in a restructuring which enables a profit to be made on the exit from its equity investment. FMS depicts the reconstruction in this case as exemplifying that model.
FMS itself is a German company which was established in 2010 by the German Federal Government to wind-up the affairs of the nationalised Hypo Real Estate Holding AG ("the HRE Group"). It operates under the supervision and control of an agency of the German Government. In its skeleton argument for the sanction hearing, its role and objectives were described as follows:
"FMS has the task of determining the most appropriate wind-down strategy in each individual case, as part of its activities to stabilise the German financial markets. It has a statutory duty to seek the best possible outcome for the German tax payer and to unwind the portfolio of assets which have been transferred to it in accordance with sound business principles and to achieve the best possible realisations from those assets as the individual circumstances of each case dictate. It is not within FMS's mandate to finance or invest in new growth opportunities."
FMS was represented throughout by Mr Richard Snowden QC and Mr Daniel Bayfield, with Mr Adam Al-Attar at the second stage...
To continue reading
Request your trial
-
Discovery (Northampton) Ltd v Debenhams Retail Ltd
...(because the rent has been reduced). 79 Mr Bayfield QC relied upon some observations of Hildyard J in Re APCOA Parking Holdings GmbH [2015] Bus LR 374. Some scheme creditors provided an indemnity to banks who issued guarantees under a secured facility: under the arrangement it was proposed ......
-
Algeco Scotsman Pik S.A. (Claimant)
...it is an example, if one has to use the phrase, of "good forum shopping". 58 I reiterate what I said in Apcoa Parking Holdings GmbH [2014] EWHC 3849 (Ch) where I also accepted that a change in jurisdiction clause for the purpose of opening the gateway to the English scheme jurisdiction was ......
-
AIRASIA X BERHADS. Suhendran vs Kwan Will SenBOC AVIATION LIMITED
...Bank NV) and other v. TT International Ltd and another appeal [2012] SGCA 9 („Royal Bank of Scotland’); Re Apcoa Parking Holdings GmbH [2015] 2 BCLC 659 at 674, para [45] („Re [48] Although the issue of creditors‟ classification was once thought better left to be determined at the Sanction ......
-
Global Garden Products Italy S.P.A.
...EWHC 1104 (Ch), [2011] Bus LR 1245, [2012] BCC 459 ("Rodenstock") and were most recently tested before Hildyard J in Re Apcoa GmbH [2014] EWHC 3849 (Ch), [2015] Bus LR 374, [2015] BCC 142 ("Apcoa") (a case in which permission to appeal to the Court of Appeal was granted, but the appeal wa......
-
Table of Cases
...Ltd [1922] 2 Ch 723 35, 36 Antal International Ltd, Re [2003] EWHC 1339 (Ch), [2003] 2 BCLC 406 159 Apcoa Parking Holdings GmbH, Re [2014] EWHC 3849 (Ch) 23 Apton New Homes v Tack (unreported), 19 June 1998 81 AR v Aviation Ltd, Re (1988) 4 BCC 708 162 Arbuthnot Leasing International Ltd v ......
-
Schemes of arrangement
...(Ch), (2013) 163(7588) NLJ 20; Re Zodiac Pool Solutions SAS [2014] EWHC 2365 (Ch), [2014] BCC 569; Re Apcoa Parking Holdings GmbH [2014] EWHC 3849 (Ch); see further Jennifer Payne, ‘Cross-border schemes of arrangement and forum shopping’ (2013) 14 EBOR 563–589) and a UK registered bank ( Re......
-
Bankruptcy Shopping: Domestic Venue Races and Global Forum Wars
...Re Magyar Telecom BV, [2013] EWHC (Ch) 3800 (Eng.).105. See Re APCOA Parking Holdings GmbH and others [2014] EWHC (Ch) 3849.The APCOA court did warn against decisions to change the law when the new choice of law "appears entirely alien to the parties' previous arrangements and/or with which......
-
THE GIBBS PRINCIPLE
...EWHC 3778 (Ch) at [17]–[18]. 48Re AI Scheme Ltd[2015] EWHC 1233 (Ch) at [26]. 49 In Re AI Scheme Ltd[2015] EWHC 2038 (Ch). 50[2014] EWHC 3849 (Ch). 51Re Apcoa Parking Holdings GmbH[2014] EWHC 3849 (Ch) at [11]. 52Re Apcoa Parking Holdings GmbH[2014] EWHC 3849 (Ch) at [205]. 53Re Apcoa Parki......